Federal tax law allows you to claim a deduction for the value of all property you donate to a qualified charity during the year provided you itemize your deductions. Generally, any nonprofit organization that promotes religious, literary, educational, scientific, humanitarian or other charitable causes will qualify. However, if the combined value of all property you donate is more than $500, you must prepare
IRS Form 8283 and attach it to your tax return.
When you donate property to a charity, the IRS allows you to deduct its fair market value. It’s your responsibility to determine the value of your property donations. There are many ways you can do this, but regardless of the valuation method you choose, your estimated value must always relate to a realistic price that a buyer would pay for the item in the open market. The IRS requires you to obtain a qualified appraisal for any single item or group of related items you donate that have a value of more than $5,000. For example, if you donate five rare first-edition books that each have a value of $1,200, you must obtain an appraisal because the items are similar and in total exceed $5,000.
At this point you must have got an idea what is the process to fill out this tax form. If you have decided to manage everything on your own then it is more important. In that case, keeping up with all the deadlines can become a little but difficult for you. This is why most of the people are thinking about hiring a tax professional these days. If you are thinking how to start, you can give us a call on
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