The holiday season is upon us. Many of us find ourselves with too long of to-do lists, family get-togethers to plan and finding ourselves short on time to get it all done. However, the holiday season is also a busy time for giving to charity. With charity gift giving, there are factors you should keep in mind.
- It’s important that any charitable gifts must be received by December 31st to count on your 2016 tax return.
- All donations must be made to a qualified charity. If you are unsure if your charity is qualified, then you can use Select Check, which is a searchable online tool available through the IRS to ensure your charity of choice is qualified.
- Any contributions made through a credit card are deductible for 2016 if made prior to the end of the year, even if the credit card statement is paid in 2017.
- If possible, get a receipt for all donations made whether money or household items.
Rules for Charitable Contributions of Clothing and Household Items
Household items include furniture, furnishings, electronics, appliances and linens. Clothing and household items donated to charity generally must be in good used condition or better to be tax-deductible. Donors must get a written receipt or acknowledgement from the charity for gifts worth $250 or more. It must include a description of the items contributed.
Rules for Monetary Donations
Documentation must show charity’s name, the date of the contribution and the amount. Bank records will count as documentation, and they include canceled checks and statements.
Money donations cash, check, electronic funds transfer, credit card and payroll deduction. For payroll deductions, the taxpayer should retain a pay stub, a Form W-2 wage statement or other document furnished by the employer showing the total amount withheld for charity, along with the pledge card showing the name of the charity.
Taxpayer must receive a receipt or acknowledgment for any donation that is $250 or more. However, one statement containing all of the required information may meet both requirements.
If you have any questions on charity gift giving, please give us a call at 573-686-3053.