Pay Attention to the Charitable Contribution Documentation Rules

Now’s the time to start gathering documentation which you will need for your 2012 tax returns. And remember that IRS imposes some very specific requirements related to supporting your charitable contributions.

To deduct any charitable donation of cash, regardless of amount, a taxpayer must have a “bank record” or a written communication from the charity showing the name of the charity and the date and amount of the contribution. Bank records typically include canceled checks and credit card statements.

And importantly, don’t forget the rule requiring that you obtain an acknowledgement from a charity for each deductible donation (whether in cash, or in the form of property) of $250 or more. And get that acknowledgement before you file your 2012 tax return!

And if all of your noncash contributions exceed $500, your return must include Form 8283, detailing all relevant information.

Check out IRS Publication 526 for more details.