It's better to gift and receipt under new tax rules

MSNBC.com ^ | Jan 10, 2007 | Aswini Anburajan

[paudio]

The biggest impact from the new rules will be felt when donors sit down to itemize write-offs on their 2007 tax returns: No longer will the IRS accept “guesstimates” on the value of bags of used clothing given to Goodwill, change dropped in the Salvation Army bucket or the church collection plate or other small donations.

Instead, taxpayers will now be required to document their giving in all shapes and sizes, from used cars to used clothing. In most cases that means obtaining receipts, but in instances where that is impractical — such as the church collection plate — detailed records will be needed to justify a credit.

In other words, whereas the old tax law assumed that taxpayers would honestly report their charitable donations, the new law demands it.

[paudio]

My church usually provides me a report every year. But that's only for the offerings that use the 'official envelopes'.

[CharlesWayneCT]

No more 3-dollar deductions for used underwear. Sorry, Mr. Clinton.

[Kenton]

No more 3-dollar deductions for used underwear. Sorry, Mr. Clinton.

Oh, I'm sure that Slick has since figured out that he can get a lot more than $3 if he sold them to Monica wannabes on E-Bay...

[Fierce Allegiance]

Crap! Glad i got those last few bags into the goodwill truck at 3:45 on 12/31/06!

[CharlesWayneCT]

One such dodge is the use of donor-advised funds, which allow individuals to give large monetary gifts to a public foundation with the stipulation that they will advise the foundation on how to make grants. Everson, the IRS commissioner, said at a Senate hearing that some donors had in turn billed the foundations for "fact-finding" trips to inform their decisions. For example, he said, one donor took his family on a trip to snorkel in the Cayman Islands in order to decide whether to donate money to coral reef preservation efforts there.

There are a lot of rich crooks in the world.

[ikka]

There are a lot of rich crooks in the world.

And they're not all in government either :-)

[linda_22003]

I've never deducted that type of thing; for me, the benefit is having all that extra stuff out of the house. The exception was when I gave a piano to the church; I got an independent valuation of it and a letter from the music director at the church confirming the gift.

I have cancelled cheques for everything else.

[Howlin]

We were driving to Roanoke on December 31st and I was absolutely stunned at the number of Goodwill trailers sitting along Route 200 between Greensboro and Roanoke.

And the lines were LONG for people waiting to get near them.

We just don't have that around Raleigh; but we should.

[Fierce Allegiance]

I like clearing out the house, and the deduction. :)

Hey, if they give me the opportunity to lower taxes on my own, I'm taking it!

All the activism in he world will likely not lower my taxes any more than I can do by cleaning house, and helping someone less fortunate at the same time.

[Fierce Allegiance]

Won't do much good taxwise anymore.

[linda_22003]

I don't get to take the full value of my itemized deductions as it is! :-\

[Fierce Allegiance]

Need some more kids? I have some I'll give you.

[linda_22003]

I need exactly the number I have, thanks - zero. Even with a token deduction, they have a terrible ROI. ;)

[Fierce Allegiance]

Even with a token deduction, they have a terrible ROI. ;)

Financially, yes. But when my little buggers hug me, it makes it sooooo worth it. :)