Donating Your Stuff Can Make You More Money Than Selling it! (If you do it right)

Donating Your Stuff Can Make You More Money Than Selling it! 

If you do it right. Last year I got nearly $2000 deducted from my tax because the value of my donations using It's Deductible Online was around $4000.  That's $2000 in my pocket as a reward for letting stuff go.  Try getting that from a garage sale!

So how do you do it right? 

1. Keep good records of your donations.  List everything you donate in writing including the Date, Item, Quantity, Condition, and Value.  In fact I created a form for my clients to do this easily and I'm now making it available to you!  You can get it by signing up for access to the Neat Living "Do-it-Yourself" Organizing Library!  You can Sign up by clicking here.

2. Use It's Deductible Online to determine the value. 

3. Get receipts for your donations.

4. Declare the donations on your tax returns!  Note that I was informed that if a single donated item is worth more than $500 you must have it appraised by an appraisal service.  Total item donations over $5000 in one year must have a certified appraisal.  Make sure you check with your accountant!

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I've been meaning to write about this for a long time. What finally motivated me to do it is a great in-depth review of  It's Deductible  written by Jessica Duquette over at the "It's Not About Your Stuff" blog.   Check it out!

It's not about your stuff!: The best Tax Deduction system for your thrift shop donations.

All the Best,

Comments

[Francesca Clarke]

Brilliant!
Do you know if there is anything like this in Canada? I can't seem to find refrence to it, but it's also the type of thing Revenu Canada wouldn't go out of it's way to let you know (although it would be wise for thrift stores to promore)!

[Ariane Benefit]

Hi Francesca,

I had no idea how Canada handles donations & taxes...but I googled it and found this article...
http://dsp-psd.pwgsc.gc.ca/Collection-R/LoPBdP/BP/bp401-e.htm#B.%20Tax
I haven't read it all, but it appears that Canada does not allow as much of a deduction as US does (we get about 25 - 50%) of the appraised market value.

Best,
Ariane

[Brianne]

This is awesome! My husband and I regularly try to get rid of our clutter and we give a lot of stuff to the local Goodwill, but we don't keep a good record of it and I'm afraid we don't get back out of it what we could. This will really help us in the next year.