Are you drawing up your year-end charitable contributions list? After you check it twice, add a reminder to gather the paperwork required to claim a gift for yourself: an itemized tax deduction.
Here are four tips:
Remember the new rules for cash donations. You’ll need a written record to deduct cash donations on your 2007 tax return, no matter what amount you donate. The record can be from the charity or, for donations under $250, in the form of a cancelled check, or credit card or bank statement.
If you contribute via payroll deduction, keep your paystub and documentation from the charity (a pledge card, for example).
Know when old rules still apply. If you donate $250 or more in money or property, ask for a receipt from the charity showing how much you contributed and any benefit you received in return.
Log vehicle expenses. Your record should indicate the charity’s name, the dates you used your car, and either the actual cost of gas and oil or the number of miles you drove. Parking fees and tolls are also deductible, whether you claim actual costs or the standard mileage rate for charitable driving (14 cents for 2007).
Keep receipts for unreimbursed items. These include out-of-pocket costs directly related to charitable service, such as buying or cleaning uniforms used for your volunteer work.
Additional recordkeeping rules may apply, depending on what you donate. For instance, some noncash contributions require an appraisal. Give us a call. We can review the records you need to obtain the maximum tax benefit.