GUIDELINES FOR MONETARY DONATIONS

Now is the time when many people make year-end donations. Here is a reminder of the guidelines.

To deduct any charitable donation of money, regardless of amount, a taxpayer must have a bank record or a written communication from the charity showing the name of the charity and the date and amount of the contribution. Bank records include canceled checks, bank or credit union statements, and credit card statements.

Unfortunately, the cash you donate is no longer deductible because you would need a written confirmation. The Santa Clause ringing the bell at the Salvation Army bucket always looks at me funny when I ask for a receipt. To get a deduction I must write a check and drop it in the bucket.

These requirements for the deduction of monetary donations do not change the long-standing requirement that a taxpayer obtain an acknowledgment from a charity for each deductible donation (either money or property) of $250 or more. However, one statement containing all of the required information may meet both requirements.

Remember that contributions are deductible in the year made. Thus, donations charged to a credit card before the end of 2009 count for 2009. This is true even if the credit card bill isn’t paid until 2010. Also, checks count for 2009 as long as they are mailed in 2009 and clear shortly thereafter.

Larry Kopsa CPA