What Do I Use for Property Description on Noncash Contributions?
When reporting noncash charitable contributions on your tax return, you must provide a detailed description of the donated property to substantiate your deduction. The IRS requires specific documentation depending on the value and type of property donated.
Required Documentation for Noncash Contributions
- Contemporaneous Written Acknowledgment (CWA): Required for all noncash donations. The charity must provide this document, which includes the date, name of the charity, description of the property, and fair market value (FMV).
- Form 8283: Required if the claimed deduction for any single item or group of similar items exceeds $500. This form must be attached to your Form 1040 and includes a detailed description of the property.
- Qualified Appraisal: Required if the claimed deduction exceeds $5,000 for any single item or group of similar items. The appraisal must be completed by a qualified appraiser and attached to Form 8283.
Property Description Requirements
The description of the property must be detailed enough to identify it clearly. For example:
- For clothing: Include type (e.g., coat, dress), condition (e.g., good, worn), and approximate age.
- For vehicles: Include make, model, year, VIN, and condition.
- For artwork or collectibles: Include artist, title, dimensions, and any known provenance.
For donations of capital gain property (such as stock or real estate held over one year), you must also report the basis and FMV. The deduction is limited to 30% of your adjusted gross income (AGI) for such donations to 50% organizations.
Important Notes
- Do not deduct the amount shown on Form 8283 if it was reported by a partnership on Schedule K-1 (Code C). The partnership’s contribution is reported separately.
- For donations over $500, you must attach Form 8283 to your return. Failure to do so may result in disallowance of the deduction.
- Use Publication 561 to determine the FMV of donated property. This publication provides guidance on valuing various types of property.
Source:
Publication 561 - Determining the Value of Donated Property
Form 8283 - Noncash Charitable Contributions
Publication 526 - Charitable Contributions
Disclaimer: Always verify details with official Federal or State Department of Revenue Forms and Instructions before filing your tax return.