Updated December 18, 2014
IRA Rollover Approved by Congress, Heads to White House For Signing
With the White House threatening a veto of a bill to make the IRA Charitable Rollover and other provisions permanent, Congress turns to a one-year extenders package. Read more.
Related Resource: IRS Webinar: Help for Charities (Thursday, Dec. 18, 2 p.m. Eastern)
Reminders: Year-End Tax Topics
· Tax Topic 506, Charitable Contributions
· Publication 526, Charitable Contributions
· Publication 561, Determining the Value of Donated Property
· Form 8283, Noncash Charitable Contributions
· Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes
Important information to keep in mind with end of the year donations…
2014 End of Year Donations
The IRS’s basic rule is that a gift must be “delivered” to the charity by 12/31. Cash and checks must be handed over to the organization by 12/31 if delivered in person or if sent using a private service like FedEx or UPS. If the donation is mailed through the US Post Office, it must have a postmark of 12/31. The organization will receive it after 12/31, but that is ok because the donor relinquished control (the IRS’s baseline threshold for determining a gift date) on the date s/he put the donation in the mail on or before 12/31. Credit card gifts must be “fully processed,” i.e., approved by the credit card merchant, for the gift to be considered “delivered” by the due date.
Donation Thank You Letters
During November and December, nonprofit organizations receive the majority of their philanthropic donations. It is important that they thank their donors and acknowledge the donation in a way that allows the donor the benefit of a tax deduction. In order to comply with the IRS, nonprofits need to include in their thank you letter the name of the organization, the date of the contribution, the amount of the contribution and a statement regarding whether or not goods or services were received for making the donation.
Here is a link to an IRS article titled Eight Tips for Deducting Charitable Contributions (updated in March 2014).
Here is a link to an IRS article titled IRS Offers Tips for Year-End Giving (updated in March 2014).
Here is a link to IRS Publication 1771 (PDF),Charitable Contributions–Substantiation and Disclosure Requirements.