I have a pile of used clothing to donate to goodwill and want to maximize my tax deduction. What is the annual limit on this type of deduction? How are these items valued? How do I doccument what I donated and the value of it all (i.e. do I need pictures, etc.)?
re: What are the tax rules concerning charitable donation of used clothing?(Posted by chuckitdeep on 12/2/12 at 8:08 pm to Spankum)
I always do an item by item with price value to the side. The value should be what a like item would be priced for at Goodwill. Ex. $8 each for 10 long sleeve button up. Good condition. Everything I have ever donated is good or excellent condition. I think the max is $500 a year without having receipts, etc. My CPA always says don't cheat yourself on deductions just be able to prove it.
Poodlebrain LSU Fan Way Right of Rex Member since Jan 2004 16517 posts
re: What are the tax rules concerning charitable donation of used clothing?(Posted by Poodlebrain on 12/2/12 at 10:11 pm to Spankum)
You can claim up to $500 wiithout providing any detail of what sort if non-cash contributions you made. If you claim over $500 then you must attach a Form 8283 providing detail of who, what, where, when and how much you donated. The Form 8283 does not provide enough space to detail out what specific items you donated. I usually use descriptions like Clothing, Toys, Household Goods, Furniture without providing specifics. If you claim a deduction of $5,000 or more, then you have to have an appraisal report.
Goodwill, St Vincent de Paul and the other big charities have forms they weill give you to document your contribution. In general they do not inventory what you donated and leave it to you to provide the detail. The IRS isn't in the habit of challenging deductions for charitable contributions as the tax revenue isn't worth the bad publicity has been my experience.