Money isn't the only thing you can give to your favorite charity. Some tax-exempt charitable organizations accept used household goods, old cars, recyclables and other things you no longer need. They either fix them up and pass them on to the people they help, or they sell them to get the cash they need to keep their operations going. You can get a federal tax deduction for some non-cash donations.
How Much Non-Cash Donations Are Deductible on Income Tax?
You can deduct most non-cash donations up to 50 percent of your gross income. Some organizations, such as veterans' organizations, have a cap of 30 percent of your income, and capital gains property may have a cap of 20 percent or 30 percent. You'll need a receipt for all donations, and a written acknowledgement of the donation and its value is necessary for any donation over $250. For donations that are worth $500 or more, fill out IRS Form 8283 and attach it to your return. If an item or a group of items is worth more than $5,000, fill out Part B of Form 8283, and have the value confirmed by a qualified appraiser.
Can Aluminum Cans Donated to Charity Be Tax Deductible?
If a charity or its agent can give you a receipt for the value of aluminum cans you donate, then you certainly can deduct the amount of that receipt from your taxes as you would any other tax-deductible donation. The receipt should correspond to the amount the charity will get from the sale of the aluminum that is recycled from the cans.
How Much Tax Deduction Can You Claim for Donated Hearing Aids & Eyeglasses?
You can claim the fair market value of the hearing aids and eyeglasses you donate to charity. You are responsible for determining the fair market value and obtaining a proper receipt. The Augusta, Georgia, branch of the Lions Club recommends dividing the price you paid for your hearing aids by five, and multiplying the result by the age of the hearing aids before subtracting that result from the original price to get the fair value. So, if you paid $500 for a hearing aid two years ago, you can deduct $300 if you donate it this year. Ask the organization to which you donate eyeglasses to help you determine their fair market value.
Can Donated Food Be Written Off as a Deduction on Taxes?
If you're in a food-related business and you donate edible food from your business that meets health and labeling guidelines, you can take a tax deduction based on the difference between its fair market value and your preparation costs. You'll find a worksheet for figuring out this deduction in IRS Publication 526. Any food you donate for this deduction has to be given directly to recipients rather than resold. If you're not in the food business and you're just donating food, it is the same as donating any other goods at fair market value.
Can Material Items Donated to a Church Be Tax Deductible?
A church or other house of worship is automatically recognized by the IRS as an organization that can receive tax-deductible donations of material goods. You don't even need to check to see whether your church has the right to accept tax-deductible donations. The rules for donating to a church are the same as for any other organization, so make sure to keep proper records and get a receipt for any donation over $250.
John DeMerceau is an American expatriate entrepreneur, marketing analyst and Web developer. He now lives and works in southeast Asia, where he creates websites and branding/marketing reports for international clients. DeMerceau graduated from Columbia University with a Bachelor of Arts in history.