"Tax Deductions for Gifts"
By Peg Bastin
Did you make any contributions to tax-exempt charitable
or religious groups last year? Did you donate gifts or
property?
Here is a review of the rules for getting tax deductions
for gifts and donations.
First, only taxpayers who itemize deductions are able to
take advantage of this benefit. If you take a standard
deduction you do not qualify for additional benefits.
The only contributions that are deductible are the ones
actually made during the tax year. For example, if you
pledged $1,200 to your church, to be paid in 12 monthly
installments of $100 beginning in June 2003, you could only
deduct $700 - the amount actually paid in 2003. The other
$500 will be carried over to be deducted in the tax year
2004.
If you make your contribution by credit card or check, the
amount is deductible in the year you CHARGED the amount or
WROTE the check, even if you don't pay the credit card or
debit your bank account til next year.
Stocks or bonds donations are valued at "fair market value"
of the property. The "fair market value" is the average of
the highest and lowest selling price on the date you donate
the stocks or bonds.
You'll need to consult with a tax professional when you
figure the value of other personal property since it can be
much more complicated.
Donating a used car can be very complex. The tax law allows
a deduction for only the fair market value of the car. The
year, model, mileage, vehicle condition, and selling prices
in your local market are taken into account. You may find
that the "fair market value" of the vehicle may be
substantially lower than the average price listed in the
used car price guide.
Ask your tax preparer about IRS News Release 2001-112,
"IRS and State Charity Officials Urge Care When Making
a Car Donation."
Don't forget to keep records to substantiate the value of
your gifts. If your individual gift is valued at less than
$250, the IRS will not require proof. But for any single
gift worth $250 or more, make sure you get a written
receipt from the charitable organization that received the
donation. A qualified written appraisal is required for any
donated property valued at more than $5,000.
I hope these tax tips and resources are saving you a lot
of your hard earned money. I'll be back again soon with
another tip for you.
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Written by Peg Bastin, who is an avid internet marketer,
glad to help others get started in their own online biz,
with Ron Mueller, author of "It's How Much You KEEP, That
Counts! Not how much you Make" © 03/15/2004
Home-Business Tax-Deductions. Do YOU Qualify? Are You SURE?
http://www.bastinmarket.com/taxpreparation.html Free ebook:
http://www.bastinmarket.com/taxesdl.html
***** ***** ***** ***** *****
You have permission to publish this article electronically
or in print, free of charge, as long as the bylines are
included. A courtesy copy of your publication would be
appreciated.
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