In our office, we like to say, “Do good and take credit for it.” This phrase especially rings true for individuals claiming charitable cash contributions. Unfortunately, the IRS is looking for more than your word. They’re looking for significant documentation in writing.
A recent case ruling has made the acknowledgement of a donation much stricter. Taxpayers who claimed over $250 cash contribution MUST consider these guidelines when donating to your church or favorite charitable organizations.
When making a cash contribution of more than $250, no deduction will be allowed unless the taxpayer receives a written contemporaneous acknowledgement from the charity. The acknowledgment must include ALL of the following:
- The name and address of the charity
- The date of the contribution
- The amount of cash contributed
- Whether the charity provided the donor with any goods or services in exchange for the contribution; and, if so, a description and a good faith estimate of the value of the goods and/or services provided to the donor.
To be contemporary, the acknowledgement must be obtained by the taxpayer on or before the earlier of:
- The date the donor files her tax return for the year the donation was made OR
- The return’s extended due date.
(The information contained above was provided by the offices of Curcuru & Associates, Certified Public Accountants. For details regarding the criteria and recent case law triggering these events, click here read the entire article.)
We suggest taking the additional steps to ensure your charitable contributions are being documented properly. So keep DOing GOOD and do an even better job taking credit for it!
The opinions and services of Curcuru & Associates are not affiliated with Raymond James. Changes in tax laws may occur at any time and could have a substantial impact upon each person’s situation. You should discuss tax or legal matters with the appropriate professional.