How do charitable donation tax deductions work?

I am possibly moving across the country and am considering donating all my furniture and most of my belongings to Goodwill or the like as an option for getting rid of stuff. I make 38,287 a year, how much (value) would I have to donate in order to have it be tax-deductible?

Someone told me that unless I make above a certain amount of money that I can’t make charitable deductions, that deductions are only available to people in higher income brackets. Is this true?

Any website, (other than IRS) that explains this stuff in plain English?

anyone can make tax-deductible donations.

they work like this:
1) you make 10,000 per year (W2)
2) you donate 1,000 to charity
3) when you file your taxes, you get to subtract that 1,000 from the amount reported on your W2 (10,000).
so, instead of paying tax on 10k, you only pay tax on 9k.

the only complication is that in order to take advantage of the tax deduction, you have to itemize. if you just take the standard deductions, you won’t see any benefit from making a deductible donation. so, if the standard deduction is more than your itemized deductions would be, then you wouldn’t see any tax benefit.

but even if you don’t get a tax deduction, donating to charity is still a good thing to do. i hope your generosity doesn’t depend on your taxable income.

This entry was posted in tax donation. Bookmark the permalink.

6 Responses to How do charitable donation tax deductions work?

  1. Randall H says:

    The real question is whether you have enough tax deductions to make it more beneficial to itemize your deductions as opposed to taking the standard deductions. Anyone can itemize if they wish and, if you itemize you can take the deduction for the value of the donation. But if your total deductions are not more than the standard deduction it doesn’t make any sense.
    References :

  2. v b says:

    Make a list of what you want to donate. Take photos.
    Visit goodwill and find out what furniture sells for.
    Be realistic that it isn’t worth very much.

    If the total is more than $5000, you need an appraisal.

    Then at tax time, you file schedule A, attaching form 8283.
    If your schedule A is *more* that your standard deduction, you take the higher amount. The amount over your standard deduction times your tax rate (you are in the 15% bracket) is the amount by which your income taxes would drop. If you don’t normally itemize, and had $6000 to itemize, you’d have to pay for an appraisal, just to get $85 back.

    Personally at that level I’d either hold a garage sale or donate with no intent of getting a tax benefit.
    References :

  3. what? says:

    anyone can make tax-deductible donations.

    they work like this:
    1) you make 10,000 per year (W2)
    2) you donate 1,000 to charity
    3) when you file your taxes, you get to subtract that 1,000 from the amount reported on your W2 (10,000).
    so, instead of paying tax on 10k, you only pay tax on 9k.

    the only complication is that in order to take advantage of the tax deduction, you have to itemize. if you just take the standard deductions, you won’t see any benefit from making a deductible donation. so, if the standard deduction is more than your itemized deductions would be, then you wouldn’t see any tax benefit.

    but even if you don’t get a tax deduction, donating to charity is still a good thing to do. i hope your generosity doesn’t depend on your taxable income.
    References :

  4. Wayne Z says:

    Charitable Contributions are itemized deductions. The total of your itemized deductions must be over your standard deduction ($5450 if you are single) before you receive any tax benefit.

    Most taxpayer’s biggest itemized deduction is mortgage interest so, unless you own a home and are paying a mortgage or you think that your furniture is worth a lot of money, it may not do you any good from a tax point of view to donate it.

    References :

  5. Jss says:

    Charity deduction is itemized deduction. You will take deduction only if your itemized deductions are more than your standard deduction.. Read: http://taxipay.blogspot.com/2008/05/itemized-deductions.html
    References :

  6. Judy says:

    As usual for tax info, "someone" told you wrong.

    To get benefit from a charitable donation, you have to itemize. There is no minimum amount. Your tax savings is the amount of the deduction times your tax bracket. The amount of the deduction is what the items would sell for in the thrift shop. So if you donate items totalling $1000 of thrift shop value, and are in a 15% bracket, your tax savings would be $150.
    References :

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Spam Protection by WP-SpamFree