Types of Tax Deductible Donations
What Are the Types of Tax-Deductible Donations? Here’s What You Need to Know
The old cliché that says, “It is better to give than to receive” suggests that when we give something valuable to someone, we should give it without expecting anything in return. The reasoning for this is that the feeling of satisfaction that giving brings is its own reward.
This saying also applies when we donate to a charitable organization like Breast Cancer Car Donations. However, the reward here is not limited to having that feeling of satisfaction. Our car donors get more than that. In fact, they received plenty of material rewards, including maximized tax deductions.
You might be wondering, “What are the types of tax-deductible donations?” Read on to find out.
Types of Donations that are Tax Deductible
Here are the types of donations given to Internal Revenue Service (IRS)-certified 501(c)3 nonprofit organizations where you can get tax write-offs:
- Appreciated property
This is the type of donation where you get the biggest deductions. Appreciated property includes securities, real estate, art, jewelry or antiques. If you donate these items, you can deduct their full fair market value, freeing yourself with the income tax on their appreciation. When donating these items, you need to keep them for 12 months or more. For property held one year or less, the IRS will only allow you to get a deduction on the price you paid for it.
- Clothing and household items
You will still get tax deductions when donating goods such as clothing, appliances, bedding, electronics, and furniture. The deductions will be based on their fair market value at the time of donation. If you donated one such item whose value is greater than $500, you will need to fill out Form 8283 and attach it to your return.
You get a tax deduction based on the exact amount of the cash you donated. If you received goods or services in return, you have to subtract the value of these goods from your tax deduction claim.
- Vehicle donation
If you’re donating a vehicle to a charity, take note that if the vehicle was sold for $500 or less, you can claim as your tax deduction either its selling price or its fair market value up to $500, whichever is higher. However, if your vehicle was sold for more than $500, you can only claim a tax deduction equivalent to your vehicle’s final selling price.
Tips for Non-Cash Items Donations
Non-cash items include those items that are freely given without the involvement of money. These include property, vehicles, or grocery items. Below are some of the important things you need to remember when donating non-cash items:
- Create a list of the products or items you’re giving away. You will need these data for Form 8283.
- Take note of the condition of each product and item and arrive at a value. The Internal Revenue Service (IRS) will permit a deduction for any product or item that is in good working condition. Simply put, do not claim a deduction for an old television that has not been working for years even if it requires only a single part. You should have its value in its present condition in the absence of the new part. You can also save the price tag or receipt to prove the value of your item if it is brand-new.
- You can also claim a deduction for foods and groceries. You can deduct the value of your donated groceries to a charity. Just make sure to obtain an acknowledgment of the item you donated and store your receipts for validation of the prices of the products or items.
- Take photos of your donations. Having photos of what you donated can be beneficial particularly if you’re donating many items. Taking photos is not a requirement, but the photos won’t hurt in case your return is audited.
- Prepare your receipts to validate your donations. Have the receipts signed when you hand over your donated This way you can be sure that the receipts are correct and include all the information you need.
Why Breast Cancer Car Donations Is Your Best Choice
If you’re looking for a charitable organization where you’ll get the highest possible tax deduction for your vehicle donation, consider Breast Cancer Car Donations as your best option. We assure you that you’ll get a 100-percent tax-deductible sales receipt after your vehicle is sold at auction. We will even refurbish your donated vehicle and send it to the best auction house that we know of so that it can attract more buyers and get its highest possible selling price.
We likewise assure you that the proceeds from the sale of your donated vehicle will be delivered straight to our nonprofit partners. These nonprofits will use the funding to sustain and expand their various programs that are all geared towards helping save the lives of breast cancer victims.
Get Started With Your Car Donations!
Experience a most rewarding giving experience when you donate your old car or truck or any other type of vehicle to Breast Cancer Donations. Contact us at 866-540-5069 or fill out our online donation form and get free towing service and a maximized tax write-off for your vehicle donation.