if I have donated (tithed money) to a church every week, and donated non-cash items to Salvation Army, Goodwill and Deseret Industries, then only the miles driven to drop off items are deductible and NOT the miles driven to and from the church (on account of getting something back- ie listening to a sermon)? Or are miles driven to the church and back deductible as well, because I have donated financially there?

Please, and thank you

For future folks reading though, there’s a couple of other things to keep in mind:

You cannot deduct less than a full interest in real property. Confusing? This means if you have a vacation property you donate to a charity (say for an auction item) you cannot deduct the market value of the rent. This also means that a charitable donation of a vacation property (less than 100% interest) counts as “personal use”. At least in my relatively conservative understanding of the tax law.

Additionally: Keep in mind if you attend charity auctions that the price of tickets are generally not 100% deductible (the value of the meal is taken out of the ticket cost). Ditto for items you purchase – the amount you pay OVER fair market value is a charitable deduction.

My personal policy at charity auctions is to give big during the “paddle raise” which is just a straight donation rather than buying auction items (unless it’s something I really want/would use). YMMV obviously.

P.S. while I am a CPA, I’m not a tax accountant. My knowledge of tax code is well informed but not extensive. Take it along with advice from a tax professional.

well, yeah, they’ll pay $75.00, or more….LoL.
I guess it would depend if the IRS agent looking
at your case had teen age girls. Of course, the
knees would have to be ripped, too…

I think it is the former- 3% of your gross income. The 5% you refer to is the value of the tax credit of the deduction, something that is totally different.

-Mike

@#10 Jonathan – I’m willing to bet that 3% number means either the average person donates about 3% of their gross income (seems reasonable to me) OR the value of the deduction is 3% of your gross income. If you’re in the 28% bracket and donate 18% of your gross income, your deduction amounts to 5% of your gross income.

I thought Sierra was right that you can’t deduct the mileage to and from the volunteer location, but the IRS website explicitly states that this is allowed.

See http://www.irs.gov/publications/p526/ar02.html:

Question: The office is 30 miles from my home. Can I deduct any of my car expenses for these trips?

Answer: Yes, you can deduct the costs of gas and oil that are directly related to
getting to and from the place where you are a volunteer. If you do not
want to figure your actual costs, you can deduct 14 cents for each
mile.

This summer a roommate and I are doing a 2000km bike ride from Shanghai to Beijing to raise money to buy bicycles for orphanages in China. We are really hoping that these will raise the quality of life for the little girls in these unfortunate circumstances. All donations are through a registered charity (Half the Sky) if you are the US, Canada, Australia, the UK, or the Netherlands, so they are tax deductible. We got lots of info on trikesfortykes.net, so please take a gander if you can!

For example, you bought stock for $2000 years ago which is now worth $5000. If you sell it, you’ll pay capital gains of 10 or 15% on $3000 gain. However, if you donate the stock to charity you can deduct the $5000 current value but not pay the capital gains tax. Fidelity has a Charitable Gift Fund to facilitate such transfers. I assume other large fund families do also.

Not a technique applicable to most readers, but when you are retired it’s a great way to continue to donate.

I keep a copy of it in my tax file. When I take a donation, I create a list of the items and then try to estimate the value of the donation. I print it and put it in the file. If the value comes out to be high, I also take a picture of everything and dump it in the file. I figure it’s well worth the effort.

For 2011 I’m going to make sure to take photos of the receipts with my iPhone immediately and use an app like Evernote or JotNote to keep track of them, b/c I know I’m going to lose some paper ones.

I’ve read elsewhere (probably on one of those “10 myths about __” articles on Fortune or WSJ or something) that the amount of deductions doesn’t affect your likelihood of getting audited, though that seems incorrect also.

Our charitable contributions are around 18% of our gross income and we haven’t been audited yet. I hope we never are, but we do have the documentation if we need it…

I’m having a really hard time estimating how much a bag of used clothes in really good condition is worth. I just don’t know! So far, my receipts from Goodwill just say something like, “2 bags.” I kind of wish they would estimate the value of the items donated to take the guess work out of it, and add to the legitimacy of the tax deduction.

…When you donate a vehicle…if they don’t sell it, or they use it themselves, then you can use the blue book value of that vehicle as your deduction….

We’ll be donating a car later this year, so this has been on my mind. In cases where they’re unable to sell it (or what have you), I had previously read we could deduct the blue book value of the car BUT only up to $500. Does anyone know if that’s still the case? Or are we now able to deduct the entire blue book value (again, assuming they don’t sell it for a lower/higher price)?

…For local travel, bear in mind that you can deduct mileage expenses for any driving you do for a non-profit organization…

I wonder if that includes driving to and from the non-profit for your volunteer shift? Or is that only when you’re driving somewhere on behalf of the non-profit organization (say to deliver something, for example)?

Sierra’s notes: I’ll have to look into your first question, but for the second, I am pretty sure it’s the latter: you can deduct only the driving you do on behalf of the non-profit, not your personal transportation to and from, which I would think would fall under personal expenses just like the lunch you buy yourself while volunteering.

These are both great questions!

I just have a folder that I start at the beginning of each year and all tax receipts go in that folder. It is a simple system, but it works quite well. If I make a credit card donation, I right it on a slip of paper and put it in a folder in case I don’t get a receipt in the mail.

Thanks, a truly informative post!