As the 2003 calendar year comes to a close, many taxpayers are beginning to think about making charitable contributions. Here are a few quick guidelines to keep in mind before you begin taking your charitable deductions.
The Internal Revenue Service requires taxpayers to substantiate all money contributions by a cancelled check, a receipt, or acknowledgement of “other reliable records.” A cancelled check alone will not substantiate a contribution of more than $250.00. For any amount more than $250.00 it is also necessary for the charity to write a contemporaneous written acknowledgement of the gift. Taxpayers do not need to receive the written acknowledgement before the end of the year, but the receipt must be received on or before the date the return is filed or by the due date of the return. Most charities will automatically provide you with documentation, but don’t hesitate to call them and ask for the status of your acknowledgement.
Many people elect to donate property to various charities, which can be beneficial for all parties. Property can include furniture, fine art or jewelry. It is important to remember that all property donations in excess of $5,000 must be supported by a qualified appraisal, unless the gift consists of publicly traded stock. Have a generous holiday season, and remember to
keep that documentation!