February 4, 2023

More Charitable Tax Tips

Posted by Diana Little
Beacon Financial

Leading Edge

Photo by How I See Life

Second entry in a series of three: If you make a donation to a charity this year, you may be able to take a deduction for it on your 2011 tax return.  Here are three of the top nine things the IRS wants every taxpayer to know before deducting charitable donations. (See tips 1 – 3).

4.       When you can deduct.  Contributions are deductible in the year made.  Thus, donations charged to a credit card before the end of 2011 count for 2011.  This is true even if the credit card bill isn’t paid until 2012.  Also, checks count for 2011 as long as they are mailed in 2011 and clear shortly thereafter.

5.       Recordkeeping is essential.  Keep good records of any contribution you make, regardless of the amount.  For any cash contribution, you must maintain a record of the contribution, such as a cancelled  check, bank or credit card statement, payroll deduction record or a written statement containing the date and amount of the contribution and the name of the organization.  For donations of property, including clothing and household items, get from the charity, if possible, a receipt that includes the name of the charity, date of the contribution, and a reasonably-detailed description of the donated property.  The estimated fair market value of the items should be included

6.       Pledges and payments.  Only contributions actually made during the tax year are deductible.  For example, if you pledged $500 in September but paid the charity only $200 by Dec. 31, you can only deduct $200.

www.beaconplus.net

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