Author Topic: Optimizing charitable donations for 2015  (Read 2190 times)

Gone Fishing

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Optimizing charitable donations for 2015
« on: November 12, 2015, 01:37:03 PM »
As this should be my last year in the 25% tax bracket, I am planning on cleaning some things out and donating them to a few local non-profits.  Total value may come up to $1,000 or so.

So far I have read:

https://www.irs.gov/uac/Newsroom/Tips-from-IRS-for-Year-End-Gifts-to-Charity

and reviewed https://www.irs.gov/pub/irs-pdf/f8283.pdf.

Our local non-profits usually just give us a blank receipt, or one with only very basic list of items.

Would I be better off breaking up the items into amounts less than $250 and making several donations to the same entity, or splitting it up and donating to several different charities?

Last thing I want to do is get audited over something a little as this...   

Sibley

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Re: Optimizing charitable donations for 2015
« Reply #1 on: November 30, 2015, 08:43:19 AM »
My parents donate stuff to Salvation Army. Mom makes a list of everything going (3 t shirts, 2 pair pants, etc), then assigns thrift store values to each, does the math and gets a total. That's the amount deducted. If the total is over whatever amount, then an additional form is filled out for taxes. The list and receipt are stored with the tax documents until I clean it out. (I made them shred/toss 30+ years of tax documents this summer. They still have a box of the more recent stuff, mom was freaking out so we kept 10 years instead of the required 7.) Never had a problem with it, and it's been done this way for 30 years.

If you're donating bigger things, other rules may apply. But clothes, household goods, etc this should work.

StacheInAFlash

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Re: Optimizing charitable donations for 2015
« Reply #2 on: December 01, 2015, 07:43:24 PM »
Keep your donations to under $500 as over that amount I believe you need to fill out another form, and I think there might be something crazy about needing an appraisal or some nonsense like that. Plus, you might face a slightly increased risk of audit with larger in-kind donations; I'm sure its my paranoia, but I always make sure to keep mine under $500. In fact, last year I calculated the value of all the goods I donated at one particular time to be $550, but i just scaled it back to $495....just because.

MDM

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Re: Optimizing charitable donations for 2015
« Reply #3 on: December 01, 2015, 10:57:03 PM »
...Plus, you might face a slightly increased risk of audit with larger in-kind donations; I'm sure its my paranoia, but I always make sure to keep mine under $500. In fact, last year I calculated the value of all the goods I donated at one particular time to be $550, but i just scaled it back to $495....just because.

Depends on the algorithm being used to flag returns for audit.  One might imagine a heuristic that says "flag a return when something is just under a limit because that person is trying to hide something" - while a return just over a limit is "probably ok because the filer went through the effort to provide the extra documentation." ;)

If the deduction is legitimate, take it.

 

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