What is the max write off allowed for charitable donations?
Posted on December 6th, 2009 by admin
I have a lot of quality items (appliances , furniture, etc.) and am wondering if I should hold on to some to donate next year.
If you take the standard deduction, you get no additional benefit from charitable contributions in most cases.
You need a receipt for each donation.
Cannot get deduction for more than 40-50% of income.
Value items donated at thrift shop value, what they would sell for now at Goodwill, Salvation Army, NOT what you paid for them. Must be in GOOD condition.
December 6th, 2009 at 9:19 am
The absolute maximum is 50 percent of your income. Of course, you are likely to be audited if you have such a huge deduction. So make sure you have it all documented.
References :
December 6th, 2009 at 9:37 am
Anything more than 30% of your gross income is likely to trigger an audit. Plus you really want to look at where you are in the marginal tax brackets.
You want to donate enough to hopefully get yourself to a lower tax bracket, but not so much that you get audited (unless, of course, you have receipts for everything, then the risk of an audit really doesn’t matter).
If you have more than 50% of your annual income to deduct, you can do the donation now, and spread the deduction out over 5 years in a process called carry forward. This is usually used when someone donates 1 thing of very significant value, and can be tricky to calculate.
If yours gifts are just an ordinary assortment of lots of medium value things (such as furniture, appliances, clothes, household goods, etc.) and you are not on a threshhold of a marginal tax bracket (meaning that a $100 deduction now will be worth the same to you next year) then I would recommend doing some now to get the 2009 deduction, and some in January to get the deduction for 2010.
References :
December 6th, 2009 at 10:08 am
If you take the standard deduction, you get no additional benefit from charitable contributions in most cases.
You need a receipt for each donation.
Cannot get deduction for more than 40-50% of income.
Value items donated at thrift shop value, what they would sell for now at Goodwill, Salvation Army, NOT what you paid for them. Must be in GOOD condition.
References :
tax pro