Charitable Deductions, Clothing and Household to Salvation Army

This might be overall one of the biggest questions we get each and every tax season. Well not questions, but certainly confusion.

According to Pub 561, the items you donate must be in good used condition (if electronic or mechanical, working) and you must determine the item’s Fair Market Value.

Sounds hard? This is probably why some forego this deduction and just leave donation in the boxes.

Well we have a few tools and recommendations to make itemization of clothing and household items a breeze:

1. When preparing your drop off, simply itemize the items donating (i.e. 3x pants, 5x shirts, coffee pot, 4x lamps, etc.)
2. GET A RECEIPT. Most Salvation Army drop offs have someone giving them or just ask at the counter. This is your only proof you donated something.
3. To make determining the FMV super easy, Salvation Army has prepared a Donation Valuation Guide. https://satruck.org/Home/DonationValueGuide

The only real limitation for the deduction is you cannot go over 50% of your Adjusted Gross Income. If you have items that are over $5,000 per single item or a group of similars items (i.e. dining table and chairs or living room set) you must have a qualified appraiser determine the Fair Market Value. There are also income limits for itemized deductions, discuss with your tax professional.

We had a client who between four siblings had over $25,000 of Clothing and Household Donations. They had all their backups and itemized the list using the Valuation Guide.

When you meet with us or your tax professional have the receipts and itemized list, with a grand total. If your situation meets the limitations, you will receive a dollar for dollar deduction on your taxes.