Make, Save, Give

“Make all you can; save all you can; give all you can.”
– John Wesley, Founder of Methodism

WesleyMakeSaveGive

Wesley’s advice is still good after all these years.

Are you earning all you can? Are you saving all you can? Are you giving all you can?

Contact me for a free 30-minute consultation to see if we can brainstorm how to make more, save more, and give more.

Assigning Value to Donations

assigning value to donationsTomorrow morning, the principal of our local church school is coming by our house with a trailer to pick up items for the annual Valley View Academy Garage Sale. We’ve got a bunch of things we haven’t used in years – some camping gear, books, printer, clothing, toys, bedding, an old refrigerator, a bicycle, skis, etc.

It used to be that you could donate things and then just estimate a total value: “I think this trunk-load of junk was worth $380.” And the Goodwill would give you a receipt and you’d assign your own value.

The IRS has gotten stricter on these things now:

To be deductible, clothing and household items donated to charity after Aug. 17, 2006, must be in good used condition or better. However, a taxpayer may claim a deduction of more than $500 for any single item, regardless of its condition, if the taxpayer includes a qualified appraisal of the item with the return. Household items include furniture, furnishings, electronics, appliances, and linens.

You also need to be sure you have a written acknowledgement from the charity of any single gift of $250 or more.

In fact, the IRS now requires you to actually inventory and assign value to each donated item. You might want to take a picture of everything laid out and use that for evidence of valuation (NOT the type of picture I posted above).

This has gotten so serious, Goodwill and others now give out Donation Valuation Guides to tell you what the IRS will think is appropriate valuation per item. Here’s a little glimpse.

valuation of donations

Is the deduction really worth your time? Maybe.

If you give tithes and offerings, you will be above the donation floor for itemized deductions. If you have a high marginal tax rate and if you have enough donations, it will definitely help lower your tax bill.

But you’d get more money out of a garage sale (and garage sale proceeds aren’t taxable). But then you would have to go through all the work of a garage sale.

Meh.

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