I'm thinking of donating about seventy items of nice clothing. How do I figure out how it will affect my taxes? I mean how much will it actually matter, money wise? I guess I don't get the whole tax write off thing, not to sound dumb. Thanks for your help!
2007-10-16 08:04:04 · 11 answers · asked by Carrie 4 in Business & Finance ➔ Taxes ➔ United States
Probably not a lot, maybe not at all. If you don't have enough itemized deductions to itemize rather than take the standard deduction, donating the items won't have any effect on your taxes.
If you itemize, you can take their fair market value (what they'd be sold for used, in their current condition, not what you paid for them) as a deduction. Your tax savings at most would be that amount times your tax bracket. So if you're in a 15% bracket, donated items currently worth $400, and already had enough deductions to itemize even before the contribution, your tax savings would be 15% of $400, or $60.
2007-10-16 17:26:06 · answer #1 · answered by Judy 7 · 0⤊ 0⤋
The only way is to itemize your deductions (Schedule A)which means you have to file a long form (1040). Your itemized deductions have to be more than your standard deduction which is based on your filing status. I would get a receipt or some sort of a list from the charity indicating the fair market value of the clothing that you are about to donate. The IRS is really watching this stuff.
2007-10-17 13:34:26 · answer #2 · answered by Gary 5 · 0⤊ 0⤋
First, are you going to be able to itemize your deductions? Do you have real estate taxes, mortgage interest, large medical expenses? If you do not have enough deductions to use Schedule A, the charitable contributions are not going to help you.
Second, without the charitable donations, do you owe income taxes? If yes, and you can itemize, you will reduce your taxes by reducing your income by the market value of the donation. If the items are worth $1,000 and you are in the 25% tax bracket, the donations are worth a savings of $250 in taxes.
Be sure to get a written acknowledgement from the charity. Attach a detailed description of the items. You will have to attach Form 8283 to your return.
http://www.irs.gov/pub/irs-pdf/f8283.pdf
If you sell your items at a consignment shop for less than you paid for them, the proceeds are tax-free to you.
2007-10-16 09:20:20 · answer #3 · answered by ninasgramma 7 · 0⤊ 0⤋
It depends whether you itemize or not. If you do not itemize (use a schedule A) then it will not effect your refund at all. You automatically get $5150 deduction as a single person. If you own a home or make a lot of money and pay large state taxes, you might itemize. A charitable deduction is one thing that can also be itemized.
But make sure you get a receipt.
2007-10-16 08:12:15 · answer #4 · answered by nystom 2 · 2⤊ 0⤋
Any donation will affect your tax payment like this:
You must know your marginal tax rate, both federal and state. This is the rate you pay on the last dollar you earn. It is also the rate that your tax savings will be based on. Whatever those rates are, combine them and multiply that by the dollar value of your donation to get your tax savings. If you're an average wage earner in New York, your marginal federal rate is 15% and your state between 5 and 7. So for every dollar in donations, your tax will reduced by twenty cents. It's better than nothing, especially if you're donating items that you have no use for anymore. Could you sell those same items for more than twenty cents on the dollar of what you value them at. If so, is it worth the time and effort?
2007-10-16 08:15:15 · answer #5 · answered by curtisports2 7 · 1⤊ 2⤋
Your mileage, postage, costs of resume production, toll calls, lodging and travel for an out of town interview, are all deductible on Schedule A Miscellaneous Deductions, to the extent those deductions exceed 2% of your income. Interview outfit is not deductible.
2016-04-09 07:55:45 · answer #6 · answered by Anonymous · 0⤊ 0⤋
You have to have enough other itemized deductions to go over the standard deduction amount or it doesn't help you at all. This is $5,350 for a single person, $7,850 for a head of household and $10,700 for a married couple.
2007-10-16 08:34:36 · answer #7 · answered by Anonymous · 0⤊ 0⤋
if they are used clothing - don't even try to claim more than 25% of their new value - if you don't itemize deductions, it won't matter anyway - you won't save any additional tax
2007-10-16 09:06:17 · answer #8 · answered by Anonymous · 0⤊ 0⤋
If the market value of the clothes is $300.00 you claim claim an exemption of $300.00.
If you tax bracket is 30% you would get credit for $90.00 i.e. your taxes would be $90.00 less or you would get an additional refund of $90.00.
2007-10-16 08:09:31 · answer #9 · answered by Squat1 5 · 0⤊ 0⤋
just get a receipt
2007-10-16 08:08:06 · answer #10 · answered by furmanator1957 4 · 0⤊ 3⤋