donations, what are they worth?

Here is one such guide

Note that all items of used clothing and household goods must be in good or better condition.

Although any such item in less than good condition that is worth $500 or more and is accompanied by a qualified appraisal and signed by a qualified appraiser, on the back of the Form 8283 may be allowed.

Photograph the donated items to prove their condition.

The costs of the photographs will be a miscellaneous deduction subject to the 2% of AGI floor.

Turbotax has an optional module, I believe Taxcut has something similar, that purports to be a database of fairly accurate values for used items based on the condition, style, and use:

"Condition is determined by the amount of noticeable wear and/or defects an item may have. Items with excessive wear or defects may be worth little or no value."

"Style is defined by factors such as brand, features, material, size, fashion, etc. depending on the item."

"Use is defined by how useful the item would be in someone's home or business today."

They define something as having "high" value under this system if the following holds (this is the actual wording from the software documentation):

• Style: Top brands/manufacturers, features, materials, etc.

• Condition: Looks new, no noticeable wear

• Use: Is still useful for the average consumer today

I've always wondered what good simply taking a photo of the donated item is, after all you could have gone into a store and taken a photo of a new item on the display floor. Probably better to make sure the photo includes you and a worker from the charitable organization in the same frame along with the item, if you're really concerned.

Finally, my personal opinion as both a taxpayer and tax preparer, there are so many options today for selling used items, from Craigslist to EBay to used book stores and consignment stores, it'd be better to disallow non-cash donations that aren't formally appraised or don't have an easily determined FMV -- let the donee sell the item and donate the cash, plus take a deduction for the costs of sale, if it's that important to them. I find myself from time to time reminding clients, gently, that the meaning of "charity" isn't defined primarily by the ability to take a tax deduction.

-Mark Bole

It is interesting to me that you allow your personal opinion on donations to influence your response to your clients regarding a perfectly legal tax deduction. Obviously you don't have to worry about such a small $$ matter yourself, but there are plenty of people on fixed incomes who need such deductions. Maybe these same people tithe to their church and give generously, moreso than you maybe. I give plenty of money away that I CAN'T claim, so when I can claim something it is beneficial to me. In fact, I would like to volunteer for Hospice but have to travel 30 miles to do so, and since mileage cannot be fully deducted, it prevents me from volunteering. Can't afford the gas. There is an entire workforce of seniors out here that our society could tap into--we don't want to be paid for our time, but we can't afford to spend money on volunteering.

Sandybeth - I have a different take on Mark's reply. There is a problem with FMV. The IRS is cracking down on the valuation people are using for donated items. I focused on "consignment shop" value, the value a willing buyer would pay for such an item as a man's used suit. But when you look at the published lists of values, they are a fraction of those numbers. So, removing some of the 'feelings' on this issue, I think you'd find the financial benefit to be larger by selling those things that can easily be sold (books, for instance) and donating the proceeds.

Joe

My personal opinion was about the not-so-legal deduction of over-valued or otherwise non-deductible, non-cash donations.

Remember that TV commercial from a few months ago, where Turbotax was touting its database of donation values (the one I mentioned in my first reply), with the actor indicating that the way to report your non-cash deductions is, "Click, money! Click, money!" Unfortunately, I think the approach is all too common.

I just took a box of used books to a large local bookstore last week and got $10 FMV for them. I know some folks, and suspect there are many more, who think *any* box of used books is easily worth ten or more times that amount, it's not.

Look at how non-cash charity is treated for tax purposes. Why do you think the law was passed in August 2006 to restrict deductions to only "good used condition or better" items? Why do you think the threshold for using Form 8283 ($500) has not been indexed for inflation in well over twenty years? Why do you think the mileage deduction for charity[1] is less than one-third that for business, and also hasn't been adjusted upward for inflation lately?

If these tax rules are the determining factor of your level of charity, then you are the one that my reminder about the meaning of charity is directed toward. I am confident that you could find ways to volunteer that require no unreimbursed out-of-pocket expenditure. If you can't afford the other kinds of charity, you'll get no harsh judgment from me, but please don't blame it on the tax laws.

BTW, I always advise my clients to take legal deductions, and I have a good-faith reliance on information provided by the client, but I also must meet ethical standards that prevent me from signing a return that appears to be incorrect, inconsistent, or incomplete.

-Mark Bole

[1] Yes I know, charitable mileage is considered a cash donation, but from the donor's perspective it seems more like a non-cash donation since it usually goes hand-in-hand with donation of time.

"Mark Bole" wrote

And unfortunately it's often for naught.

The number of people who can't itemize is higher than those who can.

Unless there's some reason to do otherwise, the cheapest used books I've seen were 50 cents for paperback and $1 for hardback. So don't take less than those numbers, at least in these parts.

Primarily because the charities have big ol' roll-off dumpsters in back, often times trashing half of the total goods contributed.

Basically they're tired of handling your trash, and the IRS is tired of you deducting your trash as charity.

Time is the most valued thing to donate. And the most rewarding when you do.

Because Bill clinton got all sorts of publiciy for taking charitible donations for his underwear -- stuff he wouldn't wear any more.

Lots of clothing you wouldn't wear anymore is in less than good condition.

Why do you think the $25,000/$32,000 threshold for taxing social security benefits has never been indexed?

Well, Congress has delegated the mileage amounts for business, medical and moving to te IRS, while keeping charitible mileage for itself.

Apparently I hit a sore spot with you, Mark. Sorry. If you reread my original post, I was merely asking for a website for a valuation chart so I could (honestly and consistently and LEGALLY) write down the value of the items I donated. I'm sure there are many differing opinions on the meaning of charity, but that wasn't my question. I was also pointing out that mileage expenses could be a factor in one's charity choices, particularly with the price of gas now. (especially in regards to people on fixed incomes). I do think that the IRS could focus on far bigger fish than the senior citizen who is volunteering his time, and I do think that the mileage for charitable work should be somewhat consistent with mileage for business. 14 cents per mile is way out of date. (my opinion).

As far as me "blaming the tax laws", All you have to do is google "charitable contributions and taxes" and you will find out that the tax loopholes are indeed plentiful and that tax laws are worthy of much blame.

BTW, I spent 3 days last week on fund raising for Relay for Life. I also donate regularly to Operation Smile, which I keep receipts for and claim on my income tax (so I guess that is not charity then?)

"sandybeth" wrote

Website values are not what makes it so. It's a guide, and it may be very well that the values of your items are worth more - or less - than the amount listed in any website.

I got the same results when selling my old books to a used bookstore. But selling on EBay I got about 30 times that! These were academic textbooks, all of them older editions of books currently in print and being used in classrooms.

Does that apply to all goods? (I've seen some books that are in worse condition than that yet still worth in the thousands.)

Seth

It applies to used clothing and household goods. I would not classify books as household goods.

But even clothing and household goods in less than good condition can be deducted for any article i) worth more than $500 and ii) with an appraisal by a qualified appraiser.