Year End Tax Tips: Charitable Donations

Here are three things you must do for a charitable contribution of cash or property to be tax deductible for the 2011 tax year.

Itemize Deductions

Obviously, you must itemize deductions. Gifts to charity are included on Schedule A of Form 1040. If you don’t itemize, it’s probably because the standard deduction for your filing status is higher than the itemized deductions.

For the 2011 tax year, the standard deduction is $5,800 for single or married filing separately, $11,600 for married filing jointly, and $8,500 for head of household.

Keep Appropriate Records

You must keep appropriate records of your donation to a qualifying charitable organization. A cancelled check, bank statement, or credit card statement can be used to substantiate gifts by check or credit card. In lieu of a bank record, you can obtain written verification from the charity. A written record from a qualifying charitable organization must show the name of the charity, date, and amount of the contribution.

Make Donations by December 31st

The last thing you have to do is make your donations of cash or property to qualifying charities by December 31st. To be deductible for the 2011 tax year, donations charged to your credit card by December 31st count as a deduction for 2011 even if you don’t pay the credit card bill until 2012.