When To Deduct

You can deduct your contributions only in the year you actually make them in cash or other property (or in a later carryover year, as explained later under Carryovers). This applies whether you use the cash or an accrual method of accounting.

Time of making contribution.   Usually, you make a contribution at the time of its unconditional delivery.

Checks.   A check that you mail to a charity is considered delivered on the date you mail it.

Credit card.   Contributions charged on your bank credit card are deductible in the year you make the charge.

Pay-by-phone account.   If you use a pay-by-phone account, the date you make a contribution is the date the financial institution pays the amount. This date should be shown on the statement the financial institution sends to you.

Stock certificate.   A gift to a charity of a properly endorsed stock certificate is completed on the date of mailing or other delivery to the charity or to the charity's agent. However, if you give a stock certificate to your agent or to the issuing corporation for transfer to the name of the charity, your gift is not completed until the date the stock is transferred on the books of the corporation.

Promissory note.   If you issue and deliver a promissory note to a charitable organization as a contribution, it is not a contribution until you make the note payments.

Option.   If you grant an option to buy real property at a bargain price to a charitable organization, you cannot take a deduction until the organization exercises the option.

Borrowed funds.   If you make a contribution with borrowed funds, you can deduct the contribution in the year you make it, regardless of when you repay the loan.

Limits on Deductions

If your total contributions for the year are 20% or less of your adjusted gross income, you do not need to read this section. The limits discussed here do not apply to you.

The amount of your deduction may be limited to either 20%, 30%, or 50% of your adjusted gross income, depending on the type of property you give and the type of organization you give it to. These limits are described below.

If your contributions are more than any of the limits that apply, see Carryovers, later.

50% Limit

This limit applies to the total of all charitable contributions you make during the year. This means that your deduction for charitable contributions cannot be more than 50% of your adjusted gross income for the year.

Generally, the 50% limit is the only limit that applies to gifts to organizations listed below under 50% limit organizations. But there is one exception. The 30% limit also applies to such gifts if they are gifts of capital gain property for which you figure your deduction using fair market value without reduction for appreciation. (See 30% Limit, later.)

50% limit organizations.   You can ask any organization whether it is a 50% limit organization and most will be able to tell you. Or you can check IRS Publication 78 or call the Tax Exempt/Government Entities Customer Service at the number listed earlier under Organizations that Qualify To Receive Deductible Contributions. The following is a partial list of the types of organizations that are 50% limit organizations.

1. Churches and conventions or associations of churches.
2. Educational organizations with a regular faculty and curriculum that normally have a regularly enrolled student body attending classes on site.
3. Hospitals and certain medical research organizations associated with these hospitals.
4. Publicly supported charities.
5. Private operating foundations.
6. Private nonoperating foundations that make qualifying distributions of 100% of contributions within 2½ months following the year they receive the contributions.
7. Certain private foundations whose contributions are pooled in a common fund, the income and principal of which are paid to public charities.

30% Limit

This limit applies to the following contributions.

• Gifts of capital gain property to 50% limit organizations. (For other gifts of capital gain property, see 20% Limit, later.) However, the 30% limit does not apply when you choose to reduce the fair market value of the property by the amount that would have been long-term capital gain if you had sold the property. Instead, only the 50% limit applies. For more information, see the rules for electing the 50% limit for capital gain property under How To Figure Your Deduction When Limits Apply in Publication 526.
• Gifts (other than gifts of capital gain property as explained under 20% Limit, later) for the use of any organization.
• Gifts (other than capital gain property as explained under 20% Limit, later) to all qualified organizations other than 50% limit organizations. This includes gifts to veterans' organizations, fraternal societies, nonprofit cemeteries, and certain private nonoperating foundations.

20% Limit

This limit applies to all gifts of capital gain property to or for the use of qualified organizations (other than gifts of capital gain property to 50% limit organizations).

Carryovers

You can carry over your contributions that you are not able to deduct in the current year because they exceed your adjusted-gross-income limits. You can deduct the excess in each of the next 5 years until it is used up, but not beyond that time. For more information, see Carryovers in Publication 526.

Records To Keep

You must keep records to prove the amount of the cash and noncash contributions you make during the year. The kind of records you must keep depends on the amount of your contributions and whether they are cash or noncash contributions.

Note.   An organization generally must give you a written statement if it receives a payment from you that is more than $75 and is partly a contribution and partly for goods or services. (See Contributions From Which You Benefit under Contributions You Can Deduct, earlier.) Keep the statement for your records. It may satisfy all or part of the recordkeeping requirements explained in the following discussions.

Cash Contributions

Cash contributions include those paid by cash, check, credit card, or payroll deduction. They also include your out-of-pocket expenses when donating your services.

For a contribution made in cash, the records you must keep depend on whether the contribution is:

1. Less than $250, or
2. $250 or more.

Amount of contribution.   In figuring whether your contribution is $250 or more, do not combine separate contributions. For example, if you gave your church $25 each week, your weekly payments do not have to be combined. Each payment is a separate contribution.

If contributions are made by payroll deduction, the deduction from each paycheck is treated as a separate contribution.

If you made a payment that is partly for goods and services, as described earlier under Contributions From Which You Benefit, your contribution is the amount of the payment that is more than the value of the goods and services.

Contributions of Less Than $250

For each cash contribution that is less than $250, you must keep one of the following items.

1. A canceled check, or a legible and readable account statement that shows:
   1. If payment was by check - the check number, amount, date posted, and to whom paid.
   2. If payment was by electronic funds transfer - the amount, date posted, and to whom paid.
   3. If payment was charged to a credit card - the amount, transaction date, and to whom paid.
2. A receipt (or a letter or other written communication) from the charitable organization showing the name of the organization, the date of the contribution, and the amount of the contribution.
3. Other reliable written records that include the information described in (2). Records may be considered reliable if they were made at or near the time of the contribution, and were regularly kept by you, or if, in the case of small donations, you have emblems, buttons, or other tokens that are regularly given to persons making small cash contributions.

Car expenses.   If you claim expenses directly related to the use of your car in giving services to a qualified organization, you must keep reliable written records of your expenses. Whether your records are considered reliable depends on all the facts and circumstances. Generally, they may be considered reliable if you made them regularly and at or near the time you had the expenses.

Your records must show the name of the organization you were serving and the date each time you used your car for a charitable purpose. If you use the standard mileage rate of 14 cents a mile, your records must show the miles you drove your car for the charitable purpose. If you deduct your actual expenses, your records must show the costs of operating the car that are directly related to a charitable purpose.

See Car expenses, earlier, under Out-of-Pocket Expenses in Giving Services, for the expenses you can deduct.

Contributions of $250 or More

You can claim a deduction for a contribution of $250 or more only if you have an acknowledgment of your contribution from the qualified organization or certain payroll deduction records.

If you made more than one contribution of $250 or more, you must have either a separate acknowledgment for each or one acknowledgment that shows your total contributions.

Acknowledgment.   The acknowledgment must meet these tests.

1. It must be written.
2. It must include:
   1. The amount of cash you contributed,
   2. Whether the qualified organization gave you any goods or services as a result of your contribution (other than certain token items and membership benefits), and
   3. A description and good faith estimate of the value of any goods or services described in (b). If the only benefit you received was an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in a commercial transaction outside the donative context, the acknowledgment must say so and does not need to describe or estimate the value of the benefit.
3. It must be received by you on or before the earlier of:
   1. The date you file your return for the year you make the contribution, or
   2. The due date, including extensions, for filing the return.

Payroll deductions.   If you make a contribution by payroll deduction, you do not need an acknowledgment from the qualified organization. But if your employer deducted $250 or more from a single paycheck, you must keep:

1. A pay stub, Form W-2, or other document furnished by your employer that proves the amount withheld, and
2. A pledge card or other document from the qualified organization that states the organization does not provide goods or services in return for any contribution made to it by payroll deduction.

Out-of-pocket expenses.   If you render services to a qualified organization and have unreimbursed out-of-pocket expenses related to those services, you can satisfy the written acknowledgment requirement just discussed if:

1. You have adequate records to prove the amount of the expenses, and
2. By the required date, you get an acknowledgment from the qualified organization that contains:
   1. A description of the services you provided,
   2. A statement of whether or not the organization provided you any goods or services to reimburse you for the expenses you incurred,
   3. A description and a good faith estimate of the value of any goods or services (other than intangible religious benefits) provided to reimburse you, and
   4. A statement of any intangible religious benefits provided to you.

Noncash Contributions

For a contribution not made in cash, the records you must keep depend on whether your deduction for the contribution is:

1. Less than $250,
2. At least $250 but not more than $500,
3. Over $500 but not more than $5,000, or
4. Over $5,000.

Amount of contribution.   In figuring whether your contribution is $250 or more, do not combine separate contributions. If you received goods or services in return, as described earlier in Contributions From Which You Benefit, reduce your contribution by the value of those goods or services. If you figure your deduction by reducing the fair market value of the donated property by its appreciation, as described earlier in Giving Property That Has Increased in Value, your contribution is the reduced amount.

Deductions of Less Than $250

If you make any noncash contribution, you must get and keep a receipt from the charitable organization showing:

1. The name of the charitable organization,
2. The date and location of the charitable contribution, and
3. A reasonably detailed description of the property.

A letter or other written communication from the charitable organization acknowledging receipt of the contribution and containing the information in (1), (2), and (3) will serve as a receipt.

You are not required to have a receipt where it is impractical to get one (for example, if you leave property at a charity's unattended drop site).

Additional records.   You must also keep reliable written records for each item of donated property. Your written records must include the following information.

1. The name and address of the organization to which you contributed.
2. The date and location of the contribution.
3. A description of the property in detail reasonable under the circumstances. For a security, keep the name of the issuer, the type of security, and whether it is regularly traded on a stock exchange or in an over-the-counter market.
4. The fair market value of the property at the time of the contribution and how you figured the fair market value. If it was determined by appraisal, keep a signed copy of the appraisal.
5. The cost or other basis of the property if you must reduce its fair market value by appreciation. Your records should also include the amount of the reduction and how you figured it. If you choose the 50% limit instead of the special 30% limit on certain capital gain property, you must keep a record showing the years for which you made the choice, contributions for the current year to which the choice applies, and carryovers from preceding years to which the choice applies. See How To Figure Your Deduction When Limits Apply in Publication 526 for information on how to make the capital gain property election.
6. The amount you claim as a deduction for the tax year as a result of the contribution, if you contribute less than your entire interest in the property during the tax year. Your records must include the amount you claimed as a deduction in any earlier years for contributions of other interests in this property. They must also include the name and address of each organization to which you contributed the other interests, the place where any such tangible property is located or kept, and the name of any person in possession of the property, other than the organization to which you contributed.
7. The terms of any conditions attached to the gift of property.

Deductions of At Least $250 But Not More Than $500

If you claim a deduction of at least $250 but not more than $500 for a noncash charitable contribution, you must get and keep an acknowledgment of your contribution from the qualified organization. If you made more than one contribution of $250 or more, you must have either a separate acknowledgment for each or one acknowledgment that shows your total contribution.

The acknowledgment must contain the information in items (1) through (3) listed under Deductions of Less Than $250, earlier, and your written records must include the information listed in that discussion under Additional records.

The acknowledgment must also meet these tests.

1. It must be written.
2. It must include:
   1. A description (but not necessarily the value) of any property you contributed,
   2. Whether the qualified organization gave you any goods or services as a result of your contribution (other than certain token items and membership benefits), and
   3. A description and good faith estimate of the value of any goods or services described in (b). If the only benefit you received was an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in a commercial transaction outside the donative context, the acknowledgment must say so and does not need to describe or estimate the value of the benefit.
3. It must be received by you on or before the earlier of:
   1. The date you file your return for the year you make the contribution, or
   2. The due date, including extensions, for filing the return.

Deductions Over $500

You are required to give additional information if you claim a deduction over $500 for noncash charitable contributions. See Records To Keep in Publication 526 for more information.

Qualified Conservation Contribution

If the gift was a qualified conservation contribution, your records must also include the fair market value of the underlying property before and after the gift and the conservation purpose furthered by the gift. See Qualified conservation contribution in Publication 561 for more information.

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