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1099 Form

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1099 Form

1099 form 18. 1099 form   Alimony Table of Contents IntroductionSpouse or former spouse. 1099 form Divorce or separation instrument. 1099 form Useful Items - You may want to see: General RulesMortgage payments. 1099 form Taxes and insurance. 1099 form Other payments to a third party. 1099 form Instruments Executed After 1984Payments to a third party. 1099 form Exception. 1099 form Substitute payments. 1099 form Specifically designated as child support. 1099 form Contingency relating to your child. 1099 form Clearly associated with a contingency. 1099 form How To Deduct Alimony Paid How To Report Alimony Received Recapture Rule Introduction This chapter discusses the rules that apply if you pay or receive alimony. 1099 form It covers the following topics. 1099 form What payments are alimony. 1099 form What payments are not alimony, such as child support. 1099 form How to deduct alimony you paid. 1099 form How to report alimony you received as income. 1099 form Whether you must recapture the tax benefits of alimony. 1099 form Recapture means adding back in your income all or part of a deduction you took in a prior year. 1099 form Alimony is a payment to or for a spouse or former spouse under a divorce or separation instrument. 1099 form It does not include voluntary payments that are not made under a divorce or separation instrument. 1099 form Alimony is deductible by the payer and must be included in the spouse's or former spouse's income. 1099 form Although this chapter is generally written for the payer of the alimony, the recipient can use the information to determine whether an amount received is alimony. 1099 form To be alimony, a payment must meet certain requirements. 1099 form Different requirements generally apply to payments under instruments executed after 1984 and to payments under instruments executed before 1985. 1099 form This chapter discusses the rules for payments under instruments executed after 1984. 1099 form If you need the rules for payments under pre-1985 instruments, get and keep a copy of the 2004 version of Publication 504. 1099 form That was the last year the information on pre-1985 instruments was included in Publication 504. 1099 form Use Table 18-1 in this chapter as a guide to determine whether certain payments are considered alimony. 1099 form Definitions. 1099 form   The following definitions apply throughout this chapter. 1099 form Spouse or former spouse. 1099 form   Unless otherwise stated, the term “spouse” includes former spouse. 1099 form Divorce or separation instrument. 1099 form   The term “divorce or separation instrument” means: A decree of divorce or separate maintenance or a written instrument incident to that decree, A written separation agreement, or A decree or any type of court order requiring a spouse to make payments for the support or maintenance of the other spouse. 1099 form This includes a temporary decree, an interlocutory (not final) decree, and a decree of alimony pendente lite (while awaiting action on the final decree or agreement). 1099 form Useful Items - You may want to see: Publication 504 Divorced or Separated Individuals General Rules The following rules apply to alimony regardless of when the divorce or separation instrument was executed. 1099 form Payments not alimony. 1099 form   Not all payments under a divorce or separation instrument are alimony. 1099 form Alimony does not include: Child support, Noncash property settlements, Payments that are your spouse's part of community income, as explained under Community Property in Publication 504, Payments to keep up the payer's property, or Use of the payer's property. 1099 form Payments to a third party. 1099 form   Cash payments, checks, or money orders to a third party on behalf of your spouse under the terms of your divorce or separation instrument can be alimony, if they otherwise qualify. 1099 form These include payments for your spouse's medical expenses, housing costs (rent, utilities, etc. 1099 form ), taxes, tuition, etc. 1099 form The payments are treated as received by your spouse and then paid to the third party. 1099 form Life insurance premiums. 1099 form   Alimony includes premiums you must pay under your divorce or separation instrument for insurance on your life to the extent your spouse owns the policy. 1099 form Payments for jointly-owned home. 1099 form   If your divorce or separation instrument states that you must pay expenses for a home owned by you and your spouse, some of your payments may be alimony. 1099 form Mortgage payments. 1099 form   If you must pay all the mortgage payments (principal and interest) on a jointly-owned home, and they otherwise qualify as alimony, you can deduct one-half of the total payments as alimony. 1099 form If you itemize deductions and the home is a qualified home, you can claim one-half of the interest in figuring your deductible interest. 1099 form Your spouse must report one-half of the payments as alimony received. 1099 form If your spouse itemizes deductions and the home is a qualified home, he or she can claim one-half of the interest on the mortgage in figuring deductible interest. 1099 form Taxes and insurance. 1099 form   If you must pay all the real estate taxes or insurance on a home held as tenants in common, you can deduct one-half of these payments as alimony. 1099 form Your spouse must report one-half of these payments as alimony received. 1099 form If you and your spouse itemize deductions, you can each claim one-half of the real estate taxes and none of the home insurance. 1099 form    If your home is held as tenants by the entirety or joint tenants, none of your payments for taxes or insurance are alimony. 1099 form But if you itemize deductions, you can claim all of the real estate taxes and none of the home insurance. 1099 form Other payments to a third party. 1099 form   If you made other third-party payments, see Publication 504 to see whether any part of the payments qualifies as alimony. 1099 form Instruments Executed After 1984 The following rules for alimony apply to payments under divorce or separation instruments executed after 1984. 1099 form Exception for instruments executed before 1985. 1099 form   There are two situations where the rules for instruments executed after 1984 apply to instruments executed before 1985. 1099 form A divorce or separation instrument executed before 1985 and then modified after 1984 to specify that the after-1984 rules will apply. 1099 form A temporary divorce or separation instrument executed before 1985 and incorporated into, or adopted by, a final decree executed after 1984 that: Changes the amount or period of payment, or Adds or deletes any contingency or condition. 1099 form   For the rules for alimony payments under pre-1985 instruments not meeting these exceptions, get the 2004 version of Publication 504 at www. 1099 form irs. 1099 form gov/pub504. 1099 form Example 1. 1099 form In November 1984, you and your former spouse executed a written separation agreement. 1099 form In February 1985, a decree of divorce was substituted for the written separation agreement. 1099 form The decree of divorce did not change the terms for the alimony you pay your former spouse. 1099 form The decree of divorce is treated as executed before 1985. 1099 form Alimony payments under this decree are not subject to the rules for payments under instruments executed after 1984. 1099 form Example 2. 1099 form Assume the same facts as in Example 1 except that the decree of divorce changed the amount of the alimony. 1099 form In this example, the decree of divorce is not treated as executed before 1985. 1099 form The alimony payments are subject to the rules for payments under instruments executed after 1984. 1099 form Alimony requirements. 1099 form   A payment to or for a spouse under a divorce or separation instrument is alimony if the spouses do not file a joint return with each other and all the following requirements are met. 1099 form The payment is in cash. 1099 form The instrument does not designate the payment as not alimony. 1099 form Spouses legally separated under a decree of divorce or separate maintenance are not members of the same household. 1099 form There is no liability to make any payment (in cash or property) after the death of the recipient spouse. 1099 form The payment is not treated as child support. 1099 form Each of these requirements is discussed below. 1099 form Cash payment requirement. 1099 form   Only cash payments, including checks and money orders, qualify as alimony. 1099 form The following do not qualify as alimony. 1099 form Transfers of services or property (including a debt instrument of a third party or an annuity contract). 1099 form Execution of a debt instrument by the payer. 1099 form The use of the payer's property. 1099 form Payments to a third party. 1099 form   Cash payments to a third party under the terms of your divorce or separation instrument can qualify as cash payments to your spouse. 1099 form See Payments to a third party under General Rules, earlier. 1099 form   Also, cash payments made to a third party at the written request of your spouse may qualify as alimony if all the following requirements are met. 1099 form The payments are in lieu of payments of alimony directly to your spouse. 1099 form The written request states that both spouses intend the payments to be treated as alimony. 1099 form You receive the written request from your spouse before you file your return for the year you made the payments. 1099 form Payments designated as not alimony. 1099 form   You and your spouse can designate that otherwise qualifying payments are not alimony. 1099 form You do this by including a provision in your divorce or separation instrument that states the payments are not deductible as alimony by you and are excludable from your spouse's income. 1099 form For this purpose, any instrument (written statement) signed by both of you that makes this designation and that refers to a previous written separation agreement is treated as a written separation agreement (and therefore a divorce or separation instrument). 1099 form If you are subject to temporary support orders, the designation must be made in the original or a later temporary support order. 1099 form   Your spouse can exclude the payments from income only if he or she attaches a copy of the instrument designating them as not alimony to his or her return. 1099 form The copy must be attached each year the designation applies. 1099 form Spouses cannot be members of the same household. 1099 form    Payments to your spouse while you are members of the same household are not alimony if you are legally separated under a decree of divorce or separate maintenance. 1099 form A home you formerly shared is considered one household, even if you physically separate yourselves in the home. 1099 form   You are not treated as members of the same household if one of you is preparing to leave the household and does leave no later than 1 month after the date of the payment. 1099 form Exception. 1099 form   If you are not legally separated under a decree of divorce or separate maintenance, a payment under a written separation agreement, support decree, or other court order may qualify as alimony even if you are members of the same household when the payment is made. 1099 form Table 18-1. 1099 form Alimony Requirements (Instruments Executed After 1984) Payments ARE alimony if all of the following are true: Payments are NOT alimony if any of the following are true: Payments are required by a divorce or separation instrument. 1099 form Payments are not required by a divorce or separation instrument. 1099 form Payer and recipient spouse do not file a joint return with each other. 1099 form Payer and recipient spouse file a joint return with each other. 1099 form Payment is in cash (including checks or money orders). 1099 form Payment is: Not in cash, A noncash property settlement, Spouse's part of community income, or To keep up the payer's property. 1099 form Payment is not designated in the instrument as not alimony. 1099 form Payment is designated in the instrument as not alimony. 1099 form Spouses legally separated under a decree of divorce or separate maintenance are not members of the same household. 1099 form Spouses legally separated under a decree of divorce or separate maintenance are members of the same household. 1099 form Payments are not required after death of the recipient spouse. 1099 form Payments are required after death of the recipient spouse. 1099 form Payment is not treated as child support. 1099 form Payment is treated as child support. 1099 form These payments are deductible by the payer and includible in income by the recipient. 1099 form These payments are neither deductible by the payer nor includible in income by the recipient. 1099 form Liability for payments after death of recipient spouse. 1099 form   If any part of payments you make must continue to be made for any period after your spouse's death, that part of your payments is not alimony, whether made before or after the death. 1099 form If all of the payments would continue, then none of the payments made before or after the death are alimony. 1099 form   The divorce or separation instrument does not have to expressly state that the payments cease upon the death of your spouse if, for example, the liability for continued payments would end under state law. 1099 form Example. 1099 form You must pay your former spouse $10,000 in cash each year for 10 years. 1099 form Your divorce decree states that the payments will end upon your former spouse's death. 1099 form You must also pay your former spouse or your former spouse's estate $20,000 in cash each year for 10 years. 1099 form The death of your spouse would not terminate these payments under state law. 1099 form The $10,000 annual payments may qualify as alimony. 1099 form The $20,000 annual payments that do not end upon your former spouse's death are not alimony. 1099 form Substitute payments. 1099 form   If you must make any payments in cash or property after your spouse's death as a substitute for continuing otherwise qualifying payments before the death, the otherwise qualifying payments are not alimony. 1099 form To the extent that your payments begin, accelerate, or increase because of the death of your spouse, otherwise qualifying payments you made may be treated as payments that were not alimony. 1099 form Whether or not such payments will be treated as not alimony depends on all the facts and circumstances. 1099 form Example 1. 1099 form Under your divorce decree, you must pay your former spouse $30,000 annually. 1099 form The payments will stop at the end of 6 years or upon your former spouse's death, if earlier. 1099 form Your former spouse has custody of your minor children. 1099 form The decree provides that if any child is still a minor at your spouse's death, you must pay $10,000 annually to a trust until the youngest child reaches the age of majority. 1099 form The trust income and corpus (principal) are to be used for your children's benefit. 1099 form These facts indicate that the payments to be made after your former spouse's death are a substitute for $10,000 of the $30,000 annual payments. 1099 form Of each of the $30,000 annual payments, $10,000 is not alimony. 1099 form Example 2. 1099 form Under your divorce decree, you must pay your former spouse $30,000 annually. 1099 form The payments will stop at the end of 15 years or upon your former spouse's death, if earlier. 1099 form The decree provides that if your former spouse dies before the end of the 15-year period, you must pay the estate the difference between $450,000 ($30,000 × 15) and the total amount paid up to that time. 1099 form For example, if your spouse dies at the end of the tenth year, you must pay the estate $150,000 ($450,000 − $300,000). 1099 form These facts indicate that the lump-sum payment to be made after your former spouse's death is a substitute for the full amount of the $30,000 annual payments. 1099 form None of the annual payments are alimony. 1099 form The result would be the same if the payment required at death were to be discounted by an appropriate interest factor to account for the prepayment. 1099 form Child support. 1099 form   A payment that is specifically designated as child support or treated as specifically designated as child support under your divorce or separation instrument is not alimony. 1099 form The amount of child support may vary over time. 1099 form Child support payments are not deductible by the payer and are not taxable to the recipient. 1099 form Specifically designated as child support. 1099 form   A payment will be treated as specifically designated as child support to the extent that the payment is reduced either: On the happening of a contingency relating to your child, or At a time that can be clearly associated with the contingency. 1099 form A payment may be treated as specifically designated as child support even if other separate payments are specifically designated as child support. 1099 form Contingency relating to your child. 1099 form   A contingency relates to your child if it depends on any event relating to that child. 1099 form It does not matter whether the event is certain or likely to occur. 1099 form Events relating to your child include the child's: Becoming employed, Dying, Leaving the household, Leaving school, Marrying, or Reaching a specified age or income level. 1099 form Clearly associated with a contingency. 1099 form   Payments that would otherwise qualify as alimony are presumed to be reduced at a time clearly associated with the happening of a contingency relating to your child only in the following situations. 1099 form The payments are to be reduced not more than 6 months before or after the date the child will reach 18, 21, or local age of majority. 1099 form The payments are to be reduced on two or more occasions that occur not more than 1 year before or after a different one of your children reaches a certain age from 18 to 24. 1099 form This certain age must be the same for each child, but need not be a whole number of years. 1099 form In all other situations, reductions in payments are not treated as clearly associated with the happening of a contingency relating to your child. 1099 form   Either you or the IRS can overcome the presumption in the two situations above. 1099 form This is done by showing that the time at which the payments are to be reduced was determined independently of any contingencies relating to your children. 1099 form For example, if you can show that the period of alimony payments is customary in the local jurisdiction, such as a period equal to one-half of the duration of the marriage, you can overcome the presumption and may be able to treat the amount as alimony. 1099 form How To Deduct Alimony Paid You can deduct alimony you paid, whether or not you itemize deductions on your return. 1099 form You must file Form 1040. 1099 form You cannot use Form 1040A or Form 1040EZ. 1099 form Enter the amount of alimony you paid on Form 1040, line 31a. 1099 form In the space provided on line 31b, enter your spouse's social security number (SSN) or individual taxpayer identification number (ITIN). 1099 form If you paid alimony to more than one person, enter the SSN or ITIN of one of the recipients. 1099 form Show the SSN or ITIN and amount paid to each other recipient on an attached statement. 1099 form Enter your total payments on line 31a. 1099 form You must provide your spouse's SSN or ITIN. 1099 form If you do not, you may have to pay a $50 penalty and your deduction may be disallowed. 1099 form For more information on SSNs and ITINs, see Social Security Number (SSN) in chapter 1. 1099 form How To Report Alimony Received Report alimony you received as income on Form 1040, line 11. 1099 form You cannot use Form 1040A or Form 1040EZ. 1099 form You must give the person who paid the alimony your SSN or ITIN. 1099 form If you do not, you may have to pay a $50 penalty. 1099 form Recapture Rule If your alimony payments decrease or end during the first 3 calendar years, you may be subject to the recapture rule. 1099 form If you are subject to this rule, you have to include in income in the third year part of the alimony payments you previously deducted. 1099 form Your spouse can deduct in the third year part of the alimony payments he or she previously included in income. 1099 form The 3-year period starts with the first calendar year you make a payment qualifying as alimony under a decree of divorce or separate maintenance or a written separation agreement. 1099 form Do not include any time in which payments were being made under temporary support orders. 1099 form The second and third years are the next 2 calendar years, whether or not payments are made during those years. 1099 form The reasons for a reduction or end of alimony payments that can require a recapture include: A change in your divorce or separation instrument, A failure to make timely payments, A reduction in your ability to provide support, or A reduction in your spouse's support needs. 1099 form When to apply the recapture rule. 1099 form   You are subject to the recapture rule in the third year if the alimony you pay in the third year decreases by more than $15,000 from the second year or the alimony you pay in the second and third years decreases significantly from the alimony you pay in the first year. 1099 form   When you figure a decrease in alimony, do not include the following amounts. 1099 form Payments made under a temporary support order. 1099 form Payments required over a period of at least 3 calendar years that vary because they are a fixed part of your income from a business or property, or from compensation for employment or self-employment. 1099 form Payments that decrease because of the death of either spouse or the remarriage of the spouse receiving the payments before the end of the third year. 1099 form Figuring the recapture. 1099 form   You can use Worksheet 1 in Publication 504 to figure recaptured alimony. 1099 form Including the recapture in income. 1099 form   If you must include a recapture amount in income, show it on Form 1040, line 11 (“Alimony received”). 1099 form Cross out “received” and enter “recapture. 1099 form ” On the dotted line next to the amount, enter your spouse's last name and SSN or ITIN. 1099 form Deducting the recapture. 1099 form   If you can deduct a recapture amount, show it on Form 1040, line 31a (“Alimony paid”). 1099 form Cross out “paid” and enter “recapture. 1099 form ” In the space provided, enter your spouse's SSN or ITIN. 1099 form Prev  Up  Next   Home   More Online Publications
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Understanding Your CP163 Notice

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What you need to do

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Answers to Common Questions

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The 1099 Form

1099 form 24. 1099 form   Contributions Table of Contents Introduction Useful Items - You may want to see: Organizations That Qualify To Receive Deductible ContributionsTypes of Qualified Organizations Contributions You Can DeductContributions From Which You Benefit Expenses Paid for Student Living With You Out-of-Pocket Expenses in Giving Services Contributions You Cannot DeductContributions to Individuals Contributions to Nonqualified Organizations Contributions From Which You Benefit Value of Time or Services Personal Expenses Appraisal Fees Contributions of PropertyException. 1099 form Household items. 1099 form Deduction more than $500. 1099 form Form 1098-C. 1099 form Filing deadline approaching and still no Form 1098-C. 1099 form Exception 1—vehicle used or improved by organization. 1099 form Exception 2—vehicle given or sold to needy individual. 1099 form Deduction $500 or less. 1099 form Right to use property. 1099 form Tangible personal property. 1099 form Future interest. 1099 form Determining Fair Market Value Giving Property That Has Decreased in Value Giving Property That Has Increased in Value When To DeductChecks. 1099 form Text message. 1099 form Credit card. 1099 form Pay-by-phone account. 1099 form Stock certificate. 1099 form Promissory note. 1099 form Option. 1099 form Borrowed funds. 1099 form Limits on DeductionsCarryovers Records To KeepCash Contributions Noncash Contributions Out-of-Pocket Expenses How To Report Introduction This chapter explains how to claim a deduction for your charitable contributions. 1099 form It discusses the following topics. 1099 form The types of organizations to which you can make deductible charitable contributions. 1099 form The types of contributions you can deduct. 1099 form How much you can deduct. 1099 form What records you must keep. 1099 form How to report your charitable contributions. 1099 form A charitable contribution is a donation or gift to, or for the use of, a qualified organization. 1099 form It is voluntary and is made without getting, or expecting to get, anything of equal value. 1099 form Form 1040 required. 1099 form    To deduct a charitable contribution, you must file Form 1040 and itemize deductions on Schedule A. 1099 form The amount of your deduction may be limited if certain rules and limits explained in this chapter apply to you. 1099 form The limits are explained in detail in Publication 526. 1099 form Useful Items - You may want to see: Publication 526 Charitable Contributions 561 Determining the Value of Donated Property Form (and Instructions) Schedule A (Form 1040) Itemized Deductions 8283 Noncash Charitable Contributions Organizations That Qualify To Receive Deductible Contributions You can deduct your contributions only if you make them to a qualified organization. 1099 form Most organizations other than churches and governments must apply to the IRS to become a qualified organization. 1099 form How to check whether an organization can receive deductible charitable contributions. 1099 form   You can ask any organization whether it is a qualified organization, and most will be able to tell you. 1099 form Or go to IRS. 1099 form gov. 1099 form Click on “Tools” and then on “Exempt Organizations Select Check” (www. 1099 form irs. 1099 form gov/Charities-&-Non-Profits/Exempt-Organizations-Select-Check). 1099 form This online tool will enable you to search for qualified organizations. 1099 form You can also call the IRS to find out if an organization is qualified. 1099 form Call 1-877-829-5500. 1099 form People who are deaf, hard of hearing, or have a speech disability and who have access to TTY/TDD equipment can call 1-800-829-4059. 1099 form Deaf or hard of hearing individuals can also contact the IRS through relay services such as the Federal Relay Service at www. 1099 form gsa. 1099 form gov/fedrelay. 1099 form Types of Qualified Organizations Generally, only the following types of organizations can be qualified organizations. 1099 form A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). 1099 form It must, however, be organized and operated only for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. 1099 form Certain organizations that foster national or international amateur sports competition also qualify. 1099 form War veterans' organizations, including posts, auxiliaries, trusts, or foundations, organized in the United States or any of its possessions (including Puerto Rico). 1099 form Domestic fraternal societies, orders, and associations operating under the lodge system. 1099 form (Your contribution to this type of organization is deductible only if it is to be used solely for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals. 1099 form ) Certain nonprofit cemetery companies or corporations. 1099 form (Your contribution to this type of organization is not deductible if it can be used for the care of a specific lot or mausoleum crypt. 1099 form ) The United States or any state, the District of Columbia, a U. 1099 form S. 1099 form possession (including Puerto Rico), a political subdivision of a state or U. 1099 form S. 1099 form possession, or an Indian tribal government or any of its subdivisions that perform substantial government functions. 1099 form (Your contribution to this type of organization is only deductible if it is to be used solely for public purposes. 1099 form ) Examples. 1099 form    The following list gives some examples of qualified organizations. 1099 form Churches, a convention or association of churches, temples, synagogues, mosques, and other religious organizations. 1099 form Most nonprofit charitable organizations such as the American Red Cross and the United Way. 1099 form Most nonprofit educational organizations, including the Boy Scouts of America, Girl Scouts of America, colleges, and museums. 1099 form This also includes nonprofit daycare centers that provide childcare to the general public if substantially all the childcare is provided to enable parents and guardians to be gainfully employed. 1099 form However, if your contribution is a substitute for tuition or other enrollment fee, it is not deductible as a charitable contribution, as explained later under Contributions You Cannot Deduct . 1099 form Nonprofit hospitals and medical research organizations. 1099 form Utility company emergency energy programs, if the utility company is an agent for a charitable organization that assists individuals with emergency energy needs. 1099 form Nonprofit volunteer fire companies. 1099 form Nonprofit organizations that develop and maintain public parks and recreation facilities. 1099 form Civil defense organizations. 1099 form Certain foreign charitable organizations. 1099 form   Under income tax treaties with Canada, Israel, and Mexico, you may be able to deduct contributions to certain Canadian, Israeli, or Mexican charitable organizations. 1099 form Generally, you must have income from sources in that country. 1099 form For additional information on the deduction of contributions to Canadian charities, see Publication 597, Information on the United States–Canada Income Tax Treaty. 1099 form If you need more information on how to figure your contribution to Mexican and Israeli charities, see Publication 526. 1099 form Contributions You Can Deduct Generally, you can deduct contributions of money or property you make to, or for the use of, a qualified organization. 1099 form A contribution is “for the use of” a qualified organization when it is held in a legally enforceable trust for the qualified organization or in a similar legal arrangement. 1099 form The contributions must be made to a qualified organization and not set aside for use by a specific person. 1099 form If you give property to a qualified organization, you generally can deduct the fair market value of the property at the time of the contribution. 1099 form See Contributions of Property , later in this chapter. 1099 form Your deduction for charitable contributions generally cannot be more than 50% of your adjusted gross income (AGI), but in some cases 20% and 30% limits may apply. 1099 form See Limits on Deductions , later. 1099 form In addition, the total of your charitable contribution deduction and certain other itemized deductions may be limited. 1099 form See chapter 29. 1099 form Table 24-1 gives examples of contributions you can and cannot deduct. 1099 form Contributions From Which You Benefit If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive. 1099 form Also see Contributions From Which You Benefit under Contributions You Cannot Deduct, later. 1099 form If you pay more than fair market value to a qualified organization for goods or services, the excess may be a charitable contribution. 1099 form For the excess amount to qualify, you must pay it with the intent to make a charitable contribution. 1099 form Example 1. 1099 form You pay $65 for a ticket to a dinner-dance at a church. 1099 form Your entire $65 payment goes to the church. 1099 form The ticket to the dinner-dance has a fair market value of $25. 1099 form When you buy your ticket, you know that its value is less than your payment. 1099 form To figure the amount of your charitable contribution, subtract the value of the benefit you receive ($25) from your total payment ($65). 1099 form You can deduct $40 as a contribution to the church. 1099 form Example 2. 1099 form At a fundraising auction conducted by a charity, you pay $600 for a week's stay at a beach house. 1099 form The amount you pay is no more than the fair rental value. 1099 form You have not made a deductible charitable contribution. 1099 form Athletic events. 1099 form   If you make a payment to, or for the benefit of, a college or university and, as a result, you receive the right to buy tickets to an athletic event in the athletic stadium of the college or university, you can deduct 80% of the payment as a charitable contribution. 1099 form   If any part of your payment is for tickets (rather than the right to buy tickets), that part is not deductible. 1099 form Subtract the price of the tickets from your payment. 1099 form You can deduct 80% of the remaining amount as a charitable contribution. 1099 form Example 1. 1099 form You pay $300 a year for membership in a university's athletic scholarship program. 1099 form The only benefit of membership is that you have the right to buy one season ticket for a seat in a designated area of the stadium at the university's home football games. 1099 form You can deduct $240 (80% of $300) as a charitable contribution. 1099 form Table 24-1. 1099 form Examples of Charitable Contributions—A Quick Check Use the following lists for a quick check of whether you can deduct a contribution. 1099 form See the rest of this chapter for more information and additional rules and limits that may apply. 1099 form Deductible As  Charitable Contributions Not Deductible  As Charitable Contributions Money or property you give to:  Churches, synagogues, temples, mosques, and other religious organizations Federal, state, and local governments, if your contribution is solely for public purposes (for example, a gift to reduce the public debt or maintain a public park) Nonprofit schools and hospitals The Salvation Army, American Red Cross, CARE, Goodwill Industries, United Way, Boy Scouts of America, Girl Scouts of America, Boys and Girls Clubs of America, etc. 1099 form War veterans groups   Expenses paid for a student living with you, sponsored by a qualified organization  Out-of-pocket expenses when you serve a qualified organization as a volunteer Money or property you give to:  Civic leagues, social and sports clubs, labor unions, and chambers of commerce Foreign organizations (except certain Canadian, Israeli, and Mexican charities) Groups that are run for personal profit Groups whose purpose is to lobby for law changes Homeowners' associations Individuals Political groups or candidates for public office   Cost of raffle, bingo, or lottery tickets  Dues, fees, or bills paid to country clubs, lodges, fraternal orders, or similar groups  Tuition  Value of your time or services  Value of blood given to a blood bank    Example 2. 1099 form The facts are the same as in Example 1 except your $300 payment includes the purchase of one season ticket for the stated ticket price of $120. 1099 form You must subtract the usual price of a ticket ($120) from your $300 payment. 1099 form The result is $180. 1099 form Your deductible charitable contribution is $144 (80% of $180). 1099 form Charity benefit events. 1099 form   If you pay a qualified organization more than fair market value for the right to attend a charity ball, banquet, show, sporting event, or other benefit event, you can deduct only the amount that is more than the value of the privileges or other benefits you receive. 1099 form   If there is an established charge for the event, that charge is the value of your benefit. 1099 form If there is no established charge, the reasonable value of the right to attend the event is the value of your benefit. 1099 form Whether you use the tickets or other privileges has no effect on the amount you can deduct. 1099 form However, if you return the ticket to the qualified organization for resale, you can deduct the entire amount you paid for the ticket. 1099 form    Even if the ticket or other evidence of payment indicates that the payment is a “contribution,” this does not mean you can deduct the entire amount. 1099 form If the ticket shows the price of admission and the amount of the contribution, you can deduct the contribution amount. 1099 form Example. 1099 form You pay $40 to see a special showing of a movie for the benefit of a qualified organization. 1099 form Printed on the ticket is “Contribution—$40. 1099 form ” If the regular price for the movie is $8, your contribution is $32 ($40 payment − $8 regular price). 1099 form Membership fees or dues. 1099 form    You may be able to deduct membership fees or dues you pay to a qualified organization. 1099 form However, you can deduct only the amount that is more than the value of the benefits you receive. 1099 form    You cannot deduct dues, fees, or assessments paid to country clubs and other social organizations. 1099 form They are not qualified organizations. 1099 form Certain membership benefits can be disregarded. 1099 form   Both you and the organization can disregard the following membership benefits if you receive them in return for an annual payment of $75 or less. 1099 form Any rights or privileges, other than those discussed under Athletic events , earlier, that you can use frequently while you are a member, such as: Free or discounted admission to the organization's facilities or events, Free or discounted parking, Preferred access to goods or services, and Discounts on the purchase of goods and services. 1099 form Admission, while you are a member, to events open only to members of the organization, if the organization reasonably projects that the cost per person (excluding any allocated overhead) is not more than $10. 1099 form 20. 1099 form Token items. 1099 form   You do not have to reduce your contribution by the value of any benefit you receive if both of the following are true. 1099 form You receive only a small item or other benefit of token value. 1099 form The qualified organization correctly determines that the value of the item or benefit you received is not substantial and informs you that you can deduct your payment in full. 1099 form Written statement. 1099 form   A qualified organization must give you a written statement if you make a payment of more than $75 that is partly a contribution and partly for goods or services. 1099 form The statement must say that you can deduct only the amount of your payment that is more than the value of the goods or services you received. 1099 form It must also give you a good faith estimate of the value of those goods or services. 1099 form   The organization can give you the statement either when it solicits or when it receives the payment from you. 1099 form Exception. 1099 form   An organization will not have to give you this statement if one of the following is true. 1099 form The organization is: A governmental organization described in (5) under Types of Qualified Organizations , earlier, or An organization formed only for religious purposes, and the only benefit you receive is an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in commercial transactions outside the donative context. 1099 form You receive only items whose value is not substantial as described under Token items , earlier. 1099 form You receive only membership benefits that can be disregarded, as described earlier. 1099 form Expenses Paid for Student Living With You You may be able to deduct some expenses of having a student live with you. 1099 form You can deduct qualifying expenses for a foreign or American student who: Lives in your home under a written agreement between you and a qualified organization as part of a program of the organization to provide educational opportunities for the student, Is not your relative or dependent, and Is a full-time student in the twelfth or any lower grade at a school in the United States. 1099 form You can deduct up to $50 a month for each full calendar month the student lives with you. 1099 form Any month when conditions (1) through (3) are met for 15 days or more counts as a full month. 1099 form For additional information, see Expenses Paid for Student Living With You in Publication 526. 1099 form Mutual exchange program. 1099 form   You cannot deduct the costs of a foreign student living in your home under a mutual exchange program through which your child will live with a family in a foreign country. 1099 form Table 24-2. 1099 form Volunteers' Questions and Answers If you volunteer for a qualified organization, the following questions and answers may apply to you. 1099 form All of the rules explained in this chapter also apply. 1099 form See, in particular, Out-of-Pocket Expenses in Giving Services . 1099 form Question Answer I volunteer 6 hours a week in the office of a qualified organization. 1099 form The receptionist is paid $10 an hour for the same work. 1099 form Can I deduct $60 a week for my time?    No, you cannot deduct the value of your time or services. 1099 form The office is 30 miles from my home. 1099 form Can I deduct any of my car expenses for these trips? Yes, you can deduct the costs of gas and oil that are directly related to getting to and from the place where you volunteer. 1099 form If you don't want to figure your actual costs, you can deduct 14 cents for each mile. 1099 form I volunteer as a Red Cross nurse's aide at a hospital. 1099 form Can I deduct the cost of the uniforms I must wear? Yes, you can deduct the cost of buying and cleaning your uniforms if the hospital is a qualified organization, the uniforms are not suitable for everyday use, and you must wear them when volunteering. 1099 form I pay a babysitter to watch my children while I volunteer for a qualified organization. 1099 form Can I deduct these costs? No, you cannot deduct payments for childcare expenses as a charitable contribution, even if you would be unable to volunteer without childcare. 1099 form (If you have childcare expenses so you can work for pay, see chapter 32. 1099 form ) Out-of-Pocket Expenses in Giving Services Although you cannot deduct the value of your services given to a qualified organization, you may be able to deduct some amounts you pay in giving services to a qualified organization. 1099 form The amounts must be: Unreimbursed, Directly connected with the services, Expenses you had only because of the services you gave, and Not personal, living, or family expenses. 1099 form Table 24-2 contains questions and answers that apply to some individuals who volunteer their services. 1099 form Conventions. 1099 form   If a qualified organization selects you to attend a convention as its representative, you can deduct unreimbursed expenses for travel, including reasonable amounts for meals and lodging, while away from home overnight in connection with the convention. 1099 form However, see Travel , later. 1099 form   You cannot deduct personal expenses for sightseeing, fishing parties, theater tickets, or nightclubs. 1099 form You also cannot deduct transportation, meals and lodging, and other expenses for your spouse or children. 1099 form    You cannot deduct your travel expenses in attending a church convention if you go only as a member of your church rather than as a chosen representative. 1099 form You can, however, deduct unreimbursed expenses that are directly connected with giving services for your church during the convention. 1099 form Uniforms. 1099 form   You can deduct the cost and upkeep of uniforms that are not suitable for everyday use and that you must wear while performing donated services for a charitable organization. 1099 form Foster parents. 1099 form   You may be able to deduct as a charitable contribution some of the costs of being a foster parent (foster care provider) if you have no profit motive in providing the foster care and are not, in fact, making a profit. 1099 form A qualified organization must select the individuals you take into your home for foster care. 1099 form    You can deduct expenses that meet both of the following requirements. 1099 form They are unreimbursed out-of-pocket expenses to feed, clothe, and care for the foster child. 1099 form They are incurred primarily to benefit the qualified organization. 1099 form   Unreimbursed expenses that you cannot deduct as charitable contributions may be considered support provided by you in determining whether you can claim the foster child as a dependent. 1099 form For details, see chapter 3. 1099 form Example. 1099 form You cared for a foster child because you wanted to adopt her, not to benefit the agency that placed her in your home. 1099 form Your unreimbursed expenses are not deductible as charitable contributions. 1099 form Car expenses. 1099 form   You can deduct as a charitable contribution any unreimbursed out-of-pocket expenses, such as the cost of gas and oil, that are directly related to the use of your car in giving services to a charitable organization. 1099 form You cannot deduct general repair and maintenance expenses, depreciation, registration fees, or the costs of tires or insurance. 1099 form    If you do not want to deduct your actual expenses, you can use a standard mileage rate of 14 cents a mile to figure your contribution. 1099 form   You can deduct parking fees and tolls whether you use your actual expenses or the standard mileage rate. 1099 form   You must keep reliable written records of your car expenses. 1099 form For more information, see Car expenses under Records To Keep, later. 1099 form Travel. 1099 form   Generally, you can claim a charitable contribution deduction for travel expenses necessarily incurred while you are away from home performing services for a charitable organization only if there is no significant element of personal pleasure, recreation, or vacation in the travel. 1099 form This applies whether you pay the expenses directly or indirectly. 1099 form You are paying the expenses indirectly if you make a payment to the charitable organization and the organization pays for your travel expenses. 1099 form   The deduction for travel expenses will not be denied simply because you enjoy providing services to the charitable organization. 1099 form Even if you enjoy the trip, you can take a charitable contribution deduction for your travel expenses if you are on duty in a genuine and substantial sense throughout the trip. 1099 form However, if you have only nominal duties, or if for significant parts of the trip you do not have any duties, you cannot deduct your travel expenses. 1099 form Example 1. 1099 form You are a troop leader for a tax-exempt youth group and you take the group on a camping trip. 1099 form You are responsible for overseeing the setup of the camp and for providing adult supervision for other activities during the entire trip. 1099 form You participate in the activities of the group and enjoy your time with them. 1099 form You oversee the breaking of camp and you transport the group home. 1099 form You can deduct your travel expenses. 1099 form Example 2. 1099 form You sail from one island to another and spend 8 hours a day counting whales and other forms of marine life. 1099 form The project is sponsored by a charitable organization. 1099 form In most circumstances, you cannot deduct your expenses. 1099 form Example 3. 1099 form You work for several hours each morning on an archaeological dig sponsored by a charitable organization. 1099 form The rest of the day is free for recreation and sightseeing. 1099 form You cannot take a charitable contribution deduction even though you work very hard during those few hours. 1099 form Example 4. 1099 form You spend the entire day attending a charitable organization's regional meeting as a chosen representative. 1099 form In the evening you go to the theater. 1099 form You can claim your travel expenses as charitable contributions, but you cannot claim the cost of your evening at the theater. 1099 form Daily allowance (per diem). 1099 form   If you provide services for a charitable organization and receive a daily allowance to cover reasonable travel expenses, including meals and lodging while away from home overnight, you must include in income any part of the allowance that is more than your deductible travel expenses. 1099 form You may be able to deduct any necessary travel expenses that are more than the allowance. 1099 form Deductible travel expenses. 1099 form   These include: Air, rail, and bus transportation, Out-of-pocket expenses for your car, Taxi fares or other costs of transportation between the airport or station and your hotel, Lodging costs, and The cost of meals. 1099 form Because these travel expenses are not business-related, they are not subject to the same limits as business-related expenses. 1099 form For information on business travel expenses, see Travel Expenses in chapter 26. 1099 form Contributions You Cannot Deduct There are some contributions you cannot deduct, such as those made to specific individuals and those made to nonqualified organizations. 1099 form (See Contributions to Individuals and Contributions to Nonqualified Organizations , next. 1099 form ) There are others you can deduct only part of, as discussed later under Contributions From Which You Benefit . 1099 form Contributions to Individuals You cannot deduct contributions to specific individuals, including the following. 1099 form Contributions to fraternal societies made for the purpose of paying medical or burial expenses of deceased members. 1099 form Contributions to individuals who are needy or worthy. 1099 form You cannot deduct these contributions even if you make them to a qualified organization for the benefit of a specific person. 1099 form But you can deduct a contribution to a qualified organization that helps needy or worthy individuals if you do not indicate that your contribution is for a specific person. 1099 form Example. 1099 form You can deduct contributions to a qualified organization for flood relief, hurricane relief, or other disaster relief. 1099 form However, you cannot deduct contributions earmarked for relief of a particular individual or family. 1099 form Payments to a member of the clergy that can be spent as he or she wishes, such as for personal expenses. 1099 form Expenses you paid for another person who provided services to a qualified organization. 1099 form Example. 1099 form Your son does missionary work. 1099 form You pay his expenses. 1099 form You cannot claim a deduction for your son's unreimbursed expenses related to his contribution of services. 1099 form Payments to a hospital that are for a specific patient's care or for services for a specific patient. 1099 form You cannot deduct these payments even if the hospital is operated by a city, a state, or other qualified organization. 1099 form Contributions to Nonqualified Organizations You cannot deduct contributions to organizations that are not qualified to receive tax-deductible contributions, including the following. 1099 form Certain state bar associations if: The bar is not a political subdivision of a state, The bar has private, as well as public, purposes, such as promoting the professional interests of members, and Your contribution is unrestricted and can be used for private purposes. 1099 form Chambers of commerce and other business leagues or organizations (but see chapter 28). 1099 form Civic leagues and associations. 1099 form Communist organizations. 1099 form Country clubs and other social clubs. 1099 form Most foreign organizations (other than certain Canadian, Israeli, or Mexican charitable organizations). 1099 form For details, see Publication 526. 1099 form Homeowners' associations. 1099 form Labor unions (but see chapter 28). 1099 form Political organizations and candidates. 1099 form Contributions From Which You Benefit If you receive or expect to receive a financial or economic benefit as a result of making a contribution to a qualified organization, you cannot deduct the part of the contribution that represents the value of the benefit you receive. 1099 form See Contributions From Which You Benefit under Contributions You Can Deduct, earlier. 1099 form These contributions include the following. 1099 form Contributions for lobbying. 1099 form This includes amounts that you earmark for use in, or in connection with, influencing specific legislation. 1099 form Contributions to a retirement home for room, board, maintenance, or admittance. 1099 form Also, if the amount of your contribution depends on the type or size of apartment you will occupy, it is not a charitable contribution. 1099 form Costs of raffles, bingo, lottery, etc. 1099 form You cannot deduct as a charitable contribution amounts you pay to buy raffle or lottery tickets or to play bingo or other games of chance. 1099 form For information on how to report gambling winnings and losses, see Gambling winnings in chapter 12 and Gambling Losses Up to the Amount of Gambling Winnings in chapter 28. 1099 form Dues to fraternal orders and similar groups. 1099 form However, see Membership fees or dues , earlier, under Contributions You Can Deduct. 1099 form Tuition, or amounts you pay instead of tuition. 1099 form You cannot deduct as a charitable contribution amounts you pay as tuition even if you pay them for children to attend parochial schools or qualifying nonprofit daycare centers. 1099 form You also cannot deduct any fixed amount you must pay in addition to, or instead of, tuition to enroll in a private school, even if it is designated as a “donation. 1099 form ” Value of Time or Services You cannot deduct the value of your time or services, including: Blood donations to the American Red Cross or to blood banks, and The value of income lost while you work as an unpaid volunteer for a qualified organization. 1099 form Personal Expenses You cannot deduct personal, living, or family expenses, such as the following items. 1099 form The cost of meals you eat while you perform services for a qualified organization unless it is necessary for you to be away from home overnight while performing the services. 1099 form Adoption expenses, including fees paid to an adoption agency and the costs of keeping a child in your home before adoption is final (but see Adoption Credit in chapter 37, and the instructions for Form 8839, Qualified Adoption Expenses). 1099 form You also may be able to claim an exemption for the child. 1099 form See Adopted child in chapter 3. 1099 form Appraisal Fees You cannot deduct as a charitable contribution any fees you pay to find the fair market value of donated property (but see chapter 28). 1099 form Contributions of Property If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution. 1099 form However, if the property has increased in value, you may have to make some adjustments to the amount of your deduction. 1099 form See Giving Property That Has Increased in Value , later. 1099 form For information about the records you must keep and the information you must furnish with your return if you donate property, see Records To Keep and How To Report , later. 1099 form Clothing and household items. 1099 form   You cannot take a deduction for clothing or household items you donate unless the clothing or household items are in good used condition or better. 1099 form Exception. 1099 form   You can take a deduction for a contribution of an item of clothing or household item that is not in good used condition or better if you deduct more than $500 for it and include a qualified appraisal of it with your return. 1099 form Household items. 1099 form   Household items include: Furniture and furnishings, Electronics, Appliances, Linens, and Other similar items. 1099 form   Household items do not include: Food, Paintings, antiques, and other objects of art, Jewelry and gems, and Collections. 1099 form Cars, boats, and airplanes. 1099 form    The following rules apply to any donation of a qualified vehicle. 1099 form A qualified vehicle is: A car or any motor vehicle manufactured mainly for use on public streets, roads, and highways, A boat, or An airplane. 1099 form Deduction more than $500. 1099 form   If you donate a qualified vehicle with a claimed fair market value of more than $500, you can deduct the smaller of: The gross proceeds from the sale of the vehicle by the organization, or The vehicle's fair market value on the date of the contribution. 1099 form If the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to figure the deductible amount, as described under Giving Property That Has Increased in Value , later. 1099 form Form 1098-C. 1099 form   You must attach to your return Copy B of the Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes, (or other statement containing the same information as Form 1098-C) you received from the organization. 1099 form The Form 1098-C (or other statement) will show the gross proceeds from the sale of the vehicle. 1099 form   If you e-file your return, you must: Attach Copy B of Form 1098-C to Form 8453 and mail the forms to the IRS, or Include Copy B of Form 1098-C as a pdf attachment if your software program allows it. 1099 form   If you do not attach Form 1098-C (or other statement), you cannot deduct your contribution. 1099 form    You must get Form 1098-C (or other statement) within 30 days of the sale of the vehicle. 1099 form But if exception 1 or 2 (described later) applies, you must get Form 1098-C (or other statement) within 30 days of your donation. 1099 form Filing deadline approaching and still no Form 1098-C. 1099 form   If the filing deadline is approaching and you still do not have a Form 1098-C, you have two choices. 1099 form Request an automatic 6-month extension of time to file your return. 1099 form You can get this extension by filing Form 4868, Application for Automatic Extension of Time to File U. 1099 form S. 1099 form Individual Income Tax Return. 1099 form  For more information, see Automatic Extension in chapter 1. 1099 form File the return on time without claiming the deduction for the qualified vehicle. 1099 form After receiving the Form 1098-C, file an amended return, Form 1040X, claiming the deduction. 1099 form Attach Copy B of Form 1098-C (or other statement) to the amended return. 1099 form For more information about amended returns, see Amended Returns and Claims for Refund in chapter 1. 1099 form Exceptions. 1099 form   There are two exceptions to the rules just described for deductions of more than $500. 1099 form Exception 1—vehicle used or improved by organization. 1099 form   If the qualified organization makes a significant intervening use of or material improvement to the vehicle before transferring it, you generally can deduct the vehicle's fair market value at the time of the contribution. 1099 form But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. 1099 form The Form 1098-C (or other statement) will show whether this exception applies. 1099 form Exception 2—vehicle given or sold to needy individual. 1099 form   If the qualified organization will give the vehicle, or sell it for a price well below fair market value, to a needy individual to further the organization's charitable purpose, you generally can deduct the vehicle's fair market value at the time of the contribution. 1099 form But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. 1099 form The Form 1098-C (or other statement) will show whether this exception applies. 1099 form   This exception does not apply if the organization sells the vehicle at auction. 1099 form In that case, you cannot deduct the vehicle's fair market value. 1099 form Example. 1099 form Anita donates a used car to a qualified organization. 1099 form She bought it 3 years ago for $9,000. 1099 form A used car guide shows the fair market value for this type of car is $6,000. 1099 form However, Anita gets a Form 1098-C from the organization showing the car was sold for $2,900. 1099 form Neither exception 1 nor exception 2 applies. 1099 form If Anita itemizes her deductions, she can deduct $2,900 for her donation. 1099 form She must attach Form 1098-C and Form 8283 to her return. 1099 form Deduction $500 or less. 1099 form   If the qualified organization sells the vehicle for $500 or less and exceptions 1 and 2 do not apply, you can deduct the smaller of: $500, or The vehicle's fair market value on the date of the contribution. 1099 form But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value , later. 1099 form   If the vehicle's fair market value is at least $250 but not more than $500, you must have a written statement from the qualified organization acknowledging your donation. 1099 form The statement must contain the information and meet the tests for an acknowledgment described under Deductions of At Least $250 But Not More Than $500 under Records To Keep, later. 1099 form Partial interest in property. 1099 form   Generally, you cannot deduct a charitable contribution of less than your entire interest in property. 1099 form Right to use property. 1099 form   A contribution of the right to use property is a contribution of less than your entire interest in that property and is not deductible. 1099 form For exceptions and more information, see Partial Interest in Property Not in Trust in Publication 561. 1099 form Future interests in tangible personal property. 1099 form   You cannot deduct the value of a charitable contribution of a future interest in tangible personal property until all intervening interests in and rights to the actual possession or enjoyment of the property have either expired or been turned over to someone other than yourself, a related person, or a related organization. 1099 form Tangible personal property. 1099 form   This is any property, other than land or buildings, that can be seen or touched. 1099 form It includes furniture, books, jewelry, paintings, and cars. 1099 form Future interest. 1099 form   This is any interest that is to begin at some future time, regardless of whether it is designated as a future interest under state law. 1099 form Determining Fair Market Value This section discusses general guidelines for determining the fair market value of various types of donated property. 1099 form Publication 561 contains a more complete discussion. 1099 form Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. 1099 form Used clothing and household items. 1099 form   The fair market value of used clothing and household goods is usually far less than what you paid for them when they were new. 1099 form   For used clothing, you should claim as the value the price that buyers of used items actually pay in used clothing stores, such as consignment or thrift shops. 1099 form See Household Goods in Publication 561 for information on the valuation of household goods, such as furniture, appliances, and linens. 1099 form Example. 1099 form Dawn Greene donated a coat to a thrift store operated by her church. 1099 form She paid $300 for the coat 3 years ago. 1099 form Similar coats in the thrift store sell for $50. 1099 form The fair market value of the coat is $50. 1099 form Dawn's donation is limited to $50. 1099 form Cars, boats, and airplanes. 1099 form   If you contribute a car, boat, or airplane to a charitable organization, you must determine its fair market value. 1099 form Certain commercial firms and trade organizations publish used car pricing guides, commonly called “blue books,” containing complete dealer sale prices or dealer average prices for recent model years. 1099 form The guides may be published monthly or seasonally and for different regions of the country. 1099 form These guides also provide estimates for adjusting for unusual equipment, unusual mileage, and physical condition. 1099 form The prices are not “official” and these publications are not considered an appraisal of any specific donated property. 1099 form But they do provide clues for making an appraisal and suggest relative prices for comparison with current sales and offerings in your area. 1099 form   You can also find used car pricing information on the Internet. 1099 form Example. 1099 form You donate a used car in poor condition to a local high school for use by students studying car repair. 1099 form A used car guide shows the dealer retail value for this type of car in poor condition is $1,600. 1099 form However, the guide shows the price for a private party sale of the car is only $750. 1099 form The fair market value of the car is considered to be $750. 1099 form Large quantities. 1099 form   If you contribute a large number of the same item, fair market value is the price at which comparable numbers of the item are being sold. 1099 form Giving Property That Has Decreased in Value If you contribute property with a fair market value that is less than your basis in it, your deduction is limited to its fair market value. 1099 form You cannot claim a deduction for the difference between the property's basis and its fair market value. 1099 form Giving Property That Has Increased in Value If you contribute property with a fair market value that is more than your basis in it, you may have to reduce the fair market value by the amount of appreciation (increase in value) when you figure your deduction. 1099 form Your basis in property is generally what you paid for it. 1099 form See chapter 13 if you need more information about basis. 1099 form Different rules apply to figuring your deduction, depending on whether the property is: Ordinary income property, or Capital gain property. 1099 form Ordinary income property. 1099 form   Property is ordinary income property if you would have recognized ordinary income or short-term capital gain had you sold it at fair market value on the date it was contributed. 1099 form Examples of ordinary income property are inventory, works of art created by the donor, manuscripts prepared by the donor, and capital assets (defined in chapter 14) held 1 year or less. 1099 form Amount of deduction. 1099 form   The amount you can deduct for a contribution of ordinary income property is its fair market value minus the amount that would be ordinary income or short-term capital gain if you sold the property for its fair market value. 1099 form Generally, this rule limits the deduction to your basis in the property. 1099 form Example. 1099 form You donate stock you held for 5 months to your church. 1099 form The fair market value of the stock on the day you donate it is $1,000, but you paid only $800 (your basis). 1099 form Because the $200 of appreciation would be short-term capital gain if you sold the stock, your deduction is limited to $800 (fair market value minus the appreciation). 1099 form Capital gain property. 1099 form   Property is capital gain property if you would have recognized long-term capital gain had you sold it at fair market value on the date of the contribution. 1099 form It includes capital assets held more than 1 year, as well as certain real property and depreciable property used in your trade or business and, generally, held more than 1 year. 1099 form Amount of deduction — general rule. 1099 form   When figuring your deduction for a contribution of capital gain property, you generally can use the fair market value of the property. 1099 form Exceptions. 1099 form   In certain situations, you must reduce the fair market value by any amount that would have been long-term capital gain if you had sold the property for its fair market value. 1099 form Generally, this means reducing the fair market value to the property's cost or other basis. 1099 form Bargain sales. 1099 form   A bargain sale of property is a sale or exchange for less than the property's fair market value. 1099 form A bargain sale to a qualified organization is partly a charitable contribution and partly a sale or exchange. 1099 form A bargain sale may result in a taxable gain. 1099 form More information. 1099 form   For more information on donating appreciated property, see Giving Property That Has Increased in Value in Publication 526. 1099 form When To Deduct You can deduct your contributions only in the year you actually make them in cash or other property (or in a later carryover year, as explained later under Carryovers ). 1099 form This applies whether you use the cash or an accrual method of accounting. 1099 form Time of making contribution. 1099 form   Usually, you make a contribution at the time of its unconditional delivery. 1099 form Checks. 1099 form   A check you mail to a charity is considered delivered on the date you mail it. 1099 form Text message. 1099 form   Contributions made by text message are deductible in the year you send the text message if the contribution is charged to your telephone or wireless account. 1099 form Credit card. 1099 form    Contributions charged on your credit card are deductible in the year you make the charge. 1099 form Pay-by-phone account. 1099 form    Contributions made through a pay-by-phone account are considered delivered on the date the financial institution pays the amount. 1099 form Stock certificate. 1099 form   A properly endorsed stock certificate is considered delivered on the date of mailing or other delivery to the charity or to the charity's agent. 1099 form However, if you give a stock certificate to your agent or to the issuing corporation for transfer to the name of the charity, your contribution is not delivered until the date the stock is transferred on the books of the corporation. 1099 form Promissory note. 1099 form   If you issue and deliver a promissory note to a charity as a contribution, it is not a contribution until you make the note payments. 1099 form Option. 1099 form    If you grant a charity an option to buy real property at a bargain price, it is not a contribution until the organization exercises the option. 1099 form Borrowed funds. 1099 form   If you contribute borrowed funds, you can deduct the contribution in the year you deliver the funds to the charity, regardless of when you repay the loan. 1099 form Limits on Deductions The amount you can deduct for charitable contributions cannot be more than 50% of your adjusted gross income (AGI). 1099 form Your deduction may be further limited to 30% or 20% of your AGI, depending on the type of property you give and the type of organization you give it to. 1099 form If your total contributions for the year are 20% or less of your AGI, these limits do not apply to you. 1099 form The limits are discussed in detail under Limits on Deductions in Publication 526. 1099 form A higher limit applies to certain qualified conservation contributions. 1099 form See Publication 526 for details. 1099 form Carryovers You can carry over any contributions you cannot deduct in the current year because they exceed your adjusted-gross-income limits. 1099 form You can deduct the excess in each of the next 5 years until it is used up, but not beyond that time. 1099 form For more information, see Carryovers in Publication 526. 1099 form Records To Keep You must keep records to prove the amount of the contributions you make during the year. 1099 form The kind of records you must keep depends on the amount of your contributions and whether they are: Cash contributions, Noncash contributions, or Out-of-pocket expenses when donating your services. 1099 form Note. 1099 form An organization generally must give you a written statement if it receives a payment from you that is more than $75 and is partly a contribution and partly for goods or services. 1099 form (See Contributions From Which You Benefit under Contributions You Can Deduct, earlier. 1099 form ) Keep the statement for your records. 1099 form It may satisfy all or part of the recordkeeping requirements explained in the following discussions. 1099 form Cash Contributions Cash contributions include those paid by cash, check, electronic funds transfer, debit card, credit card, or payroll deduction. 1099 form You cannot deduct a cash contribution, regardless of the amount, unless you keep one of the following. 1099 form A bank record that shows the name of the qualified organization, the date of the contribution, and the amount of the contribution. 1099 form Bank records may include: A canceled check, A bank or credit union statement, or A credit card statement. 1099 form A receipt (or a letter or other written communication) from the qualified organization showing the name of the organization, the date of the contribution, and the amount of the contribution. 1099 form The payroll deduction records described next. 1099 form Payroll deductions. 1099 form   If you make a contribution by payroll deduction, you must keep: A pay stub, Form W-2, or other document furnished by your employer that shows the date and amount of the contribution, and A pledge card or other document prepared by or for the qualified organization that shows the name of the organization. 1099 form If your employer withheld $250 or more from a single paycheck, see Contributions of $250 or More , next. 1099 form Contributions of $250 or More You can claim a deduction for a contribution of $250 or more only if you have an acknowledgment of your contribution from the qualified organization or certain payroll deduction records. 1099 form If you made more than one contribution of $250 or more, you must have either a separate acknowledgment for each or one acknowledgment that lists each contribution and the date of each contribution and shows your total contributions. 1099 form Amount of contribution. 1099 form   In figuring whether your contribution is $250 or more, do not combine separate contributions. 1099 form For example, if you gave your church $25 each week, your weekly payments do not have to be combined. 1099 form Each payment is a separate contribution. 1099 form   If contributions are made by payroll deduction, the deduction from each paycheck is treated as a separate contribution. 1099 form   If you made a payment that is partly for goods and services, as described earlier under Contributions From Which You Benefit , your contribution is the amount of the payment that is more than the value of the goods and services. 1099 form Acknowledgment. 1099 form   The acknowledgment must meet these tests. 1099 form It must be written. 1099 form It must include: The amount of cash you contributed, Whether the qualified organization gave you any goods or services as a result of your contribution (other than certain token items and membership benefits), A description and good faith estimate of the value of any goods or services described in (b) (other than intangible religious benefits), and A statement that the only benefit you received was an intangible religious benefit, if that was the case. 1099 form The acknowledgment does not need to describe or estimate the value of an intangible religious benefit. 1099 form An intangible religious benefit is a benefit that generally is not sold in commercial transactions outside a donative (gift) context. 1099 form An example is admission to a religious ceremony. 1099 form You must get it on or before the earlier of: The date you file your return for the year you make the contribution, or The due date, including extensions, for filing the return. 1099 form   If the acknowledgment does not show the date of the contribution, you must also have a bank record or receipt, as described earlier, that does show the date of the contribution. 1099 form If the acknowledgment shows the date of the contribution and meets the other tests just described, you do not need any other records. 1099 form Payroll deductions. 1099 form   If you make a contribution by payroll deduction and your employer withholds $250 or more from a single paycheck, you must keep: A pay stub, Form W-2, or other document furnished by your employer that shows the amount withheld as a contribution, and A pledge card or other document prepared by or for the qualified organization that shows the name of the organization and states the organization does not provide goods or services in return for any contribution made to it by payroll deduction. 1099 form A single pledge card may be kept for all contributions made by payroll deduction regardless of amount as long as it contains all the required information. 1099 form   If the pay stub, Form W-2, pledge card, or other document does not show the date of the contribution, you must have another document that does show the date of the contribution. 1099 form If the pay stub, Form W-2, pledge card, or other document shows the date of the contribution, you do not need any other records except those just described in (1) and (2). 1099 form Noncash Contributions For a contribution not made in cash, the records you must keep depend on whether your deduction for the contribution is: Less than $250, At least $250 but not more than $500, Over $500 but not more than $5,000, or Over $5,000. 1099 form Amount of deduction. 1099 form   In figuring whether your deduction is $500 or more, combine your claimed deductions for all similar items of property donated to any charitable organization during the year. 1099 form   If you received goods or services in return, as described earlier in Contributions From Which You Benefit , reduce your contribution by the value of those goods or services. 1099 form If you figure your deduction by reducing the fair market value of the donated property by its appreciation, as described earlier in Giving Property That Has Increased in Value , your contribution is the reduced amount. 1099 form Deductions of Less Than $250 If you make any noncash contribution, you must get and keep a receipt from the charitable organization showing: The name of the charitable organization, The date and location of the charitable contribution, and A reasonably detailed description of the property. 1099 form A letter or other written communication from the charitable organization acknowledging receipt of the contribution and containing the information in (1), (2), and (3) will serve as a receipt. 1099 form You are not required to have a receipt where it is impractical to get one (for example, if you leave property at a charity's unattended drop site). 1099 form Additional records. 1099 form   You must also keep reliable written records for each item of contributed property. 1099 form Your written records must include the following information. 1099 form The name and address of the organization to which you contributed. 1099 form The date and location of the contribution. 1099 form A description of the property in detail reasonable under the circumstances. 1099 form For a security, keep the name of the issuer, the type of security, and whether it is regularly traded on a stock exchange or in an over-the-counter market. 1099 form The fair market value of the property at the time of the contribution and how you figured the fair market value. 1099 form If it was determined by appraisal, keep a signed copy of the appraisal. 1099 form The cost or other basis of the property, if you must reduce its fair market value by appreciation. 1099 form Your records should also include the amount of the reduction and how you figured it. 1099 form The amount you claim as a deduction for the tax year as a result of the contribution, if you contribute less than your entire interest in the property during the tax year. 1099 form Your records must include the amount you claimed as a deduction in any earlier years for contributions of other interests in this property. 1099 form They must also include the name and address of each organization to which you contributed the other interests, the place where any such tangible property is located or kept, and the name of any person in possession of the property, other than the organization to which you contributed it. 1099 form The terms of any conditions attached to the contribution of property. 1099 form Deductions of At Least $250 But Not More Than $500 If you claim a deduction of at least $250 but not more than $500 for a noncash charitable contribution, you must get and keep an acknowledgment of your contribution from the qualified organization. 1099 form If you made more than one contribution of $250 or more, you must have either a separate acknowledgment for each or one acknowledgment that shows your total contributions. 1099 form The acknowledgment must contain the information in items (1) through (3) under Deductions of Less Than $250 , earlier, and your written records must include the information listed in that discussion under Additional records . 1099 form The acknowledgment must also meet these tests. 1099 form It must be written. 1099 form It must include: A description (but not necessarily the value) of any property you contributed, Whether the qualified organization gave you any goods or services as a result of your contribution (other than certain token items and membership benefits), and A description and good faith estimate of the value of any goods or services described in (b). 1099 form If the only benefit you received was an intangible religious benefit (such as admission to a religious ceremony) that generally is not sold in a commercial transaction outside the donative context, the acknowledgment must say so and does not need to describe or estimate the value of the benefit. 1099 form You must get it on or before the earlier of: The date you file your return for the year you make the contribution, or The due date, including extensions, for filing the return. 1099 form Deductions Over $500 You are required to give additional information if you claim a deduction over $500 for noncash charitable contributions. 1099 form See Records To Keep in Publication 526 for more information. 1099 form Out-of-Pocket Expenses If you give services to a qualified organization and have unreimbursed out-of-pocket expenses related to those services, the following two rules apply. 1099 form You must have adequate records to prove the amount of the expenses. 1099 form If any of your unreimbursed out-of-pocket expenses, considered separately, are $250 or more (for example, you pay $250 or more for an airline ticket to attend a convention of a qualified organization as a chosen representative), you must get an acknowledgment from the qualified organization that contains: A description of the services you provided, A statement of whether or not the organization provided you any goods or services to reimburse you for the expenses you incurred, A description and a good faith estimate of the value of any goods or services (other than intangible religious benefits) provided to reimburse you, and A statement that the only benefit you received was an intangible religious benefit, if that was the case. 1099 form The acknowledgment does not need to describe or estimate the value of an intangible religious benefit (defined earlier under Acknowledgment ). 1099 form You must get the acknowledgment on or before the earlier of: The date you file your return for the year you make the contribution, or The due date, including extensions, for filing the return. 1099 form Car expenses. 1099 form   If you claim expenses directly related to use of your car in giving services to a qualified organization, you must keep reliable written records of your expenses. 1099 form Whether your records are considered reliable depends on all the facts and circumstances. 1099 form Generally, they may be considered reliable if you made them regularly and at or near the time you had the expenses. 1099 form   For example, your records might show the name of the organization you were serving and the dates you used your car for a charitable purpose. 1099 form If you use the standard mileage rate of 14 cents a mile, your records must show the miles you drove your car for the charitable purpose. 1099 form If you deduct your actual expenses, your records must show the costs of operating the car that are directly related to a charitable purpose. 1099 form   See Car expenses under Out-of-Pocket Expenses in Giving Services, earlier, for the expenses you can deduct. 1099 form How To Report Report your charitable contributions on Schedule A (Form 1040). 1099 form If your total deduction for all noncash contributions for the year is over $500, you must also file Form 8283. 1099 form See How To Report in Publication 526 for more information. 1099 form Prev  Up  Next   Home   More Online Publications