Support for Your Charitable Contributions: Rules for Reporting Cash and Property Deductions

It’s that time of year when we start gathering tax documents to put together our 2015 individual tax returns. Most of the documents that support our tax filings are fairly straight forward such as: W-2s, 1099s, mortgage interest statements and real estate tax bills.  However, many taxpayers have a “soft spot” in their tax return – the deduction for charitable contributions.

The days of loosely estimating your charitable contributions of cash and property are long gone.  There are very specific rules and regulations concerning the substantiation of charitable contributions.  If the IRS chooses your tax return for examination, they will almost certainly review your charitable deductions to determine if the proper documentation has been obtained. Here’s a brief summary of the support you will need for contributions of cash and property:

Cash contributions under $250 – The taxpayer must obtain and keep a bank record or a written communication from the charitable organization.  Written records prepared by the taxpayer such as check registers or personal notations are no longer sufficient.  Bank records for this purpose include bank statements, canceled checks, or credit card statements. They must show the date paid, the name of the charity, and the amount of the payment.

Cash contributions of $250 or more – In addition to the above requirements, the taxpayer is also required to obtain a “contemporaneous written acknowledgment” from the charitable organization.  To be contemporaneous, the written acknowledgment must be obtained no later than the date the taxpayer files the tax return for the year of the donation.  The written acknowledgment must state whether the donee provided any goods or services in exchange for the contribution, and if so, a good faith estimate as to the value of the goods or services.

Property contributions – The rules concerning contributions of property can be very complex and depend on the types and amounts of property contributed.  Here are a few basic rules to keep in mind:

  • For all contributions of property, no matter the amount, you must keep reliable written records of the contributions, including the name and address of the donee organization, the date of the contribution, a description of the property, the fair value of the property and how you determined the fair value.
  • If you claim a deduction for a contribution of property of $250 or more, you must obtain a contemporaneous written acknowledgement from the donee organization (as described above) that includes a description of the property donated, but not necessarily the value of the property.  Separate contributions of less than $250 are not grouped together for purposes of this rule.
  • If you claim a deduction for a contribution of property in excess of $5,000 (for one item or a group of similar items), in addition to the above requirements, you must also obtain a qualified written appraisal of the donated property from a qualified appraiser.

This is just an overview of the basic rules.  More detailed guidance concerning the deductibility of charitable contributions and substantiation requirements can be found in IRS Publication 526.

The IRS and the Tax Courts have been very strict in their interpretation and enforcement of the substantiation requirements.  There have been many recent Court cases where the taxpayer has shown substantial, good-faith compliance with the rules, but has still lost their case because they failed to meet all of the technical substantiation requirements.  So before you file your tax return for 2015, make sure that you have the appropriate records to support your charitable contributions, and also don’t forget to obtain a written acknowledgement from the charity for contributions of $250 or more.

Contact us if you have questions regarding rules for charitable contributions and visit our Tax Services page to learn more about the services that we offer our clients.

You’ve heard our thoughts… We’d like to hear yours

The Schneider Downs Our Thoughts On blog exists to create a dialogue on issues that are important to organizations and individuals. While we enjoy sharing our ideas and insights, we’re especially interested in what you may have to say. If you have a question or a comment about this article – or any article from the Our Thoughts On blog – we hope you’ll share it with us. After all, a dialogue is an exchange of ideas, and we’d like to hear from you. Email us at

Material discussed is meant for informational purposes only, and it is not to be construed as investment, tax, or legal advice. Please note that individual situations can vary. Therefore, this information should be relied upon when coordinated with individual professional advice.

© 2020 Schneider Downs. All rights-reserved. All content on this site is property of Schneider Downs unless otherwise noted and should not be used without written permission.

our thoughts on

Selling Your Business to the Next Generation While Deferring Tax Liability and Supporting a Favorite Charity
PA Unemployment Compensation Benefits Charges Update
Tax BY Kirk Mitchell
Preliminary Observations on Tax Implications of 2020 Elections
Projected Estate and Gift Tax Changes Announced by the IRS for 2021
EU Provides Guidance on the New E-Commerce VAT Rules
The IRS Wants to Verify Your Identity—Wait, Is This a Scam?

Register to receive our weekly newsletter with our most recent columns and insights.

Have a question? Ask us!

We’d love to hear from you. Drop us a note, and we’ll respond to you as quickly as possible.

Ask us

contact us

Map of Pittsburgh Office

One PPG Place, Suite 1700
Pittsburgh, PA 15222
p:412.261.3644     f:412.261.4876

Map of Columbus Office

65 East State Street, Suite 2000
Columbus, OH 43215
p:614.621.4060     f:614.621.4062

Map of Washington Office
Washington, D.C.

1660 International Drive, Suite 600
McLean, VA 22102