A client comes in with a receipt from a charitable organization's logo: receipt# 1021; 40 lbs clothes and toys, value 1000. Are you comfortable deduct it? Most organization don't give value for non-cash donation.
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NO!
I have one client that basically gets all the junk from family, friends, neighbors and street sidewalks after garage sales and donates to Salvation Army, Big Brothers, Hartspring etc.
I have her count exactly how many pieces of what and fill out a spreadsheet with Salvation Army price list. The first year I asked her to do, she initially refused and I told her to go somewhere else or pay my assistant $20/hr to do her work! She chose to do it herself.
There is NO WAY I am going to accept a dollar amount over $500/bag for X bags of clothes.Taxes after all are the dues that we pay for the privileges of membership in an organized society. - FDR -
If the client was the one put value on the receipt, then I won't accept it without detailed valuation. But if the organization put the value on the receipt, wouldn't that shift the responsibility to the organization to prove it.Comment
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Donees don't determine the FMV of donated property. That's the donor's responsibility ... or, in some cases, an appraiser's.
$1,000 seems awfully high for 40 pounds of used clothes and toys. If this were my client, I would insist on an item-by-item list of the donated property together with a FMV for each item.Roland Slugg
"I do what I can."Comment
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Agree with that.Comment
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