GREENFIELD — There are still a few days left to make charitable contributions that will count toward tax deductions for 2012.
Donations can be made through Dec. 31, but the Internal Revenue Service reminds both individuals and businesses looking for a tax break for donations to charity to keep in mind some key tax provisions that have taken effect in recent years.
Those new rules are especially pertinent when making donations of clothing, household items and money, according to information from Luis Garcia, IRS media relations.
Garcia explains that to qualify for a deduction, clothing and household items donated to charity must be in good used condition or better. That standard, however, does not apply to donations valued over $500 if the taxpayer includes a qualified appraisal.
To deduct charitable donations of money, taxpayers must have a bank record or written communication from the charity showing the name of the organization, the date and the amount of the contribution.
Donations of money include those made in cash or by check, electronic fund transfer, credit card or payroll deduction. Contributions are deductible in the year they are made. Thus, donations charged to a credit card before the end of 2012 count for 2012. Also, checks count for 2012 as long as they are mailed in 2012.
Garcia also notes that only donations to qualified organizations are tax-deductible. Exempt Organization Select Checkout, a searchable online database available on IRS.gov, lists most organizations that are qualified to receive deductible contributions.
In addition, churches, synagogues, temples, mosques and government agencies are eligible to receive deductible donations, even if they are not listed in the database.
Charitable contributions are a popular way for filers with higher tax burdens to write-down at least part of their total tax bill.
Tim Plunkett, owner of Greenfield’s Liberty Tax Service, said it’s often people with higher incomes who usually end up having to pay more to the government in taxes and end up doing more giving.
“But they have little more to give,” Plunkett said. “So, it all works out in the end.”
In order to make the most of those potential deductions, though, Plunkett said filers should be ready with receipts for charitable contributions on hand.
Clients who deliver those receipts ahead of time to their tax professional will speed up the filing process, he said.
“When people ask what they should bring, I tell them to bring everything and anything they think might even go on a tax return,” Plunkett said. “I’d rather someone bring a whole box… I hate having to send people back and forth.”
Plunkett also advises that filers should be realistic about the value of their donations. For donations of clothing and other goods to places like Goodwill and other nonprofits, the value of the donation is what it is worth to the organization. So a box of clothes that costs $1,000 to buy might only be worth a $100 to Goodwill, where most items will be resold for just a few dollars each.
“Everyone wants to try to take as big a deduction as they can, but you have to do that within reason,” he said.