Today we are going to look at making donations and some ideas for last minute planning.
As a general rule, you may deduct the full amount of monetary donations made to qualified charitable organizations. If you donate appreciated property held for more than one year, you can generally deduct the fair-market value of the property.
Year-end strategy: Step up charitable gift-giving at the end of the year. If you use a credit card to pay for donations before January 1, 2010, you can deduct the full amount on your 2009 return—even if you don’t actually pay off the credit card charge until 2010. Congress recently tightened the substantiation rules for monetary gifts. For instance, no deduction is allowed unless you maintain a record of the contribution, such as a bank statement, receipt or written communication from the charity. The written communication must show the charity’s name, the date of the contribution and the amount of the donation.
Tip: Deductions for charitable gifts of clothing and household goods are generally limited to items in “good condition.” However, if you obtain an appraisal of more than $500 for a single item, the amount may be deducted, regardless of its condition.
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