Before you donate money or goods, research the charity. Be certain that the charity is real. Several agencies offer information to help you evaluate the operation of charities:
The Internal Revenue Service offers tax tips for donors.
Check a charity's 501(c)3 status with the IRS' exempt organization database. A charity must have 501(c)3 status if you plan to deduct your donation on your federal taxes.
The attorney general in your state often licenses charitable organizations. They may also have records of complaints about charities.
The Better Business Bureau offers reports about how large charities use their funds.
TYPES OF DONATIONS
Make financial donations by check or credit card. These payment methods can help you keep record of your donations. They can also protect you from charity scams.
Goods and Personal Property
Some charities accept non-cash donations, such as clothing and household items. Donate items that are in good (or better) condition. Keep a list of the items you donated, for your taxes.
You can donate your car, truck, boat, or other vehicle to a charity. An organization may give a donated vehicle to someone, use it for operations, or sell it at auction. If you donate a vehicle, you will need to transfer the title of the to the charity. Also, remove license plates and registration documents before you donate the car.
You may also give other types of items to charities:
The value of these items may need an expert appraisal. The values could depend on offers to buy the items and the timing of the donation.
Some scammers take advantage of the public’s generosity. They especially take advantage of tragedies and disasters.
How to Report Charity Scams
Your state consumer protection office accepts and investigates scam complaints.
File a complaint with the Federal Trade Commission (FTC). The FTC does not resolve individual matters. But it does track charity fraud claims and sues companies on the behalf of consumers.
Contact the National Center for Disaster Fraud, if the fraud is because of a natural disaster.
How to Protect Yourself From Charity Scams
Follow these tips to detect common charity scam tactics:
Check out the charity with your state consumer protection office or the Better Business Bureau.
Verify the name. Fake charities often choose names that are close to well established charities.
Use the IRS’s database of 501(c)3 organizations to find out if an organization is a registered nonprofit organization.
Don’t give in to high pressure tactics such as urging you to donate immediately.
Don’t send cash. Pay with a check or credit card.
Federal Tax Deductions for Charitable Donations
You may be able to claim a deduction on your federal taxes if you donated to a 501(c)3 organization. To deduct donations, you must file a Schedule A with your tax form. With proper documentation, you can claim vehicle or cash donations. Or, if you want to deduct a non-cash donation, you'll also have to fill out Form 8283.
How Much Can You Deduct?
The amount of money that you can deduct on your taxes may not be equal to the total amount of your donations.
If you donate non-cash items, you can claim the fair market value of the items on your taxes.
If you donated a vehicle, your deduction depends on if the organization keeps the car or sells it at an auction. “A Donor’s Guide to Vehicle Donation (PDF, Download Adobe Reader)” explains how your deduction is determined.
If you received a gift or ticket to an event, you can only deduct the amount that exceeds the value of the gift or ticket.
Note: Limits on cash and non-cash charitable donations have increased or been suspended. Learn more about charitable deductions in 2021.
Keep Records of Charitable Donations
To claim deductions, it’s important to keep records of your donations to charities. You may not have to send these documents with your tax returns, but they are good to keep with your other tax records. Common documents include:
Written acknowledgment of vehicle donations
Bank records or a written communication for cash donations
Form 8283 for non-cash deductions