If you donated clothes, furniture, or other household items this year and want to claim them on your taxes, you need to know how to value them correctly. The IRS has specific rules about what counts as a valid deduction and how to calculate it. The short answer: you value donated household goods using their … Read more
Every year, Americans donate billions of dollars worth of clothing to charity, yet most people leave money on the table at tax time because they do not know how to value those donations properly. If you have ever stared at a bag of old jackets and jeans wondering what they are actually worth on your … Read more
Membership dues to a nonprofit are tax-deductible only when the organization is a qualified 501(c)(3) (or another IRS-approved type) and only for the portion of your dues that exceeds the fair market value of any benefits you receive in return. This answer catches most people off guard. They assume any payment to a nonprofit is … Read more
A quid pro quo charitable contribution is a payment made to a charity partly as a donation and partly for goods or services received in return. If you give $100 to a nonprofit and receive a dinner ticket worth $30, only $70 counts as a deductible charitable contribution. The IRS treats the $30 portion as … Read more
Every year, donors lose legitimate tax deductions because their charitable donation receipts are missing required information. The IRS does not accept “I gave money” as proof. Without a properly documented receipt, a perfectly valid $500 contribution to a qualifying nonprofit can be disallowed during an audit. A charitable donation receipt is a written acknowledgment from … Read more
If you run a 501(c)(3) nonprofit and have ever asked “when must a nonprofit send donation receipts?” you are not alone. Our team fields this question from executive directors, board members, and volunteer treasurers every week. The short answer comes straight from the IRS: a nonprofit must provide a contemporaneous written acknowledgment for any single … Read more