Why documentation matters
Charitable deductions can lower your tax bill, but the IRS requires documentation to substantiate those claims. Without the right records you may lose a deduction during an audit. Over my 15 years advising taxpayers, I’ve found that a simple, year‑long filing habit saves time and prevents costly mistakes when tax season arrives.
Authoritative guidance: see IRS Publication 526 and the Charitable Contributions page on IRS.gov for official substantiation rules (IRS Publication 526; IRS Charitable Contributions).
Core documentation rules — quick summary
- Cash donations under $250: bank record (canceled check, bank or credit‑card statement) or a written communication from the charity showing the amount and date are sufficient.
- Cash donations of $250 or more: a contemporaneous written acknowledgment (CWA) from the charity that states the amount, date, and whether any goods or services were received in exchange (IRS Publication 526).
- Payroll deductions: a pay stub, Form W‑2 showing charitable contributions, or employer‑provided pledge card plus charity acknowledgment.
- Noncash contributions over $500: complete Form 8283 (Noncash Charitable Contributions) and keep a receipt describing the donated items.
- Noncash contributions over $5,000 (most property): a qualified appraisal is generally required and you must attach Section B of Form 8283 to your tax return (see Form 8283 instructions).
- Vehicle donations: deductible amount depends on how the charity uses or sells the vehicle; charities must provide Form 1098‑C or a written acknowledgment for contributions over $500 (see Form 1098‑C information).
(IRS references: Publication 526, Form 8283, Form 1098‑C — see IRS.gov.)
Detailed documentation checklist (what to keep and when)
- Cash contributions (checks, credit cards, ACH, cash):
- Under $250: bank record (bank/credit‑card statement) OR a written communication from the charity that shows name, date and amount.
- $250 or more: contemporaneous written acknowledgment from the charity that includes the donation amount, date, and a statement describing any goods or services received in return (e.g., dinner, gift) (IRS Publication 526).
- Payroll withholdings/voluntary employer deductions:
- Pay stub, W‑2, or payroll records plus a written acknowledgment from the charity when required.
- Noncash donations (clothes, household goods, equipment, securities):
- A detailed receipt from the charity listing the items donated.
- For noncash gifts > $500: complete Form 8283 and keep any supporting documents (e.g., photos, prior valuations).
- For gifts > $5,000: obtain a qualified appraisal and attach Section B of Form 8283 to your return (exceptions apply, such as publicly traded securities).
- Vehicle, boat, or airplane donations:
- Charity must provide either Form 1098‑C or a written acknowledgment. The deductible amount depends on the charity’s use or sale of the vehicle — if they sell it, your deduction may be limited to the sale proceeds.
- Appreciated securities (stocks, bonds):
- Broker statement showing transfer to charity and the date and fair market value on the date of the gift. For whole‑share transfers, broker letters are usually sufficient even when the value exceeds $5,000.
- Real estate or closely held business interests:
- Written acknowledgment, appraisal when value exceeds thresholds, title and closing documents, and Form 8283 when required.
- Qualified charitable distributions (QCDs) from IRAs:
- IRA trustee statements showing the QCD distribution sent directly to a qualified charity; include the charity’s name and amount. QCDs are reported differently from itemized deductions — keep trustee documentation for your records.
Examples that illustrate common situations
-
Example 1 — Cash gift of $100 by check: keep a copy of the canceled check or a bank statement showing the check cleared; no charity acknowledgment required, though a receipt is useful.
-
Example 2 — Cash gift of $500 via credit card: obtain the charity’s contemporaneous written acknowledgment showing amount and date; keep the credit‑card statement as backup.
-
Example 3 — Donated furniture valued at $1,200: keep a donation receipt describing the items and their condition and fill out Form 8283 if total noncash donations exceed $500. Photographs and prior purchase receipts help substantiate value.
-
Example 4 — Donated a car: charity provides Form 1098‑C showing whether the vehicle was sold or used. If sold, your deduction is generally limited to the sale price; if used in the charity’s program, the charity may allow deduction equal to fair market value (see Form 1098‑C guidance).
Special rules and red flags
- Valuation: you must claim a reasonable, supportable value. For publicly traded securities the fair market value is the average of the high and low on the donation date; for other property, IRS rules require documentation and, in some cases, an appraisal.
- Appraisals: a “qualified appraisal” must meet IRS standards and appraisers should sign Form 8283. Self‑prepared appraisals are not acceptable for most high‑value gifts.
- Contemporaneous written acknowledgment: must be obtained by the earlier of the date you file your return or the extended due date.
- Bundled solicitations: if your donation goes to a fundraiser where only a portion benefits the charity (e.g., tickets to a gala), the acknowledgment must clearly state the deductible portion.
Recordkeeping best practices (professional tips)
- Create a single folder—digital or physical—labeled “Charitable Donations” and add items immediately: receipts, bank statements, Form 1098‑C, broker letters, and appraisals.
- Scan paper receipts and store in a dated folder; searchable PDFs speed preparation and audits.
- For noncash donations, document condition with photos and keep a short note explaining how you arrived at the claimed value.
- Ask charities for the CWA at the time of donation rather than waiting until tax time.
- When donating securities, transfer them directly from your brokerage to the charity’s brokerage account to avoid a taxable gain and to capture the gifting date.
Common mistakes to avoid
- Assuming a canceled check is always sufficient for large gifts of $250 or more — if the charity gives goods or services in return, the CWA must disclose that.
- Failing to attach Form 8283 when required for noncash gifts over $500.
- Relying on sticker prices or personal guesses for the value of property without appraisal support for high‑value items.
- Forgetting to retain employer payroll records for payroll‑deducted gifts.
Audit preparation and what the IRS looks for
During an audit the IRS will ask for:
- Contemporaneous written acknowledgments for gifts of $250 or more.
- Form 8283 and qualified appraisals for applicable noncash gifts.
- Bank or brokerage records that show the transfer.
If you’re missing a receipt, the IRS will accept secondary evidence (bank statements, transfer confirmations), but a missing CWA for $250+ gifts is a common reason deductions are disallowed.
Links and additional resources
- IRS Charitable Contributions: https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-contributions
- IRS Publication 526, Charitable Contributions: https://www.irs.gov/pub/irs-pdf/p526.pdf
- Form 8283, Noncash Charitable Contributions: https://www.irs.gov/forms-pubs/about-form-8283
- Form 1098‑C, Contributions of Motor Vehicles, Boats, and Airplanes: https://www.irs.gov/forms-pubs/about-form-1098-c
Internal guides on FinHelp.io:
- How to Document Charitable Donations for Maximum Deduction — practical steps and examples: https://finhelp.io/glossary/how-to-document-charitable-donations-for-maximum-deduction/
- Charitable Giving: Receipts, Limits, and Recordkeeping — longer checklist and timing strategies: https://finhelp.io/glossary/charitable-giving-receipts-limits-and-recordkeeping/
FAQs (quick answers)
Q: Can I deduct the value of my volunteer time?
A: No. The value of your time is not deductible. You can deduct unreimbursed out‑of‑pocket costs related to volunteering (mileage, supplies) with records (IRS Publication 526).
Q: What if the charity issued a receipt but it lacks details?
A: Request a corrected contemporaneous written acknowledgment. If you can’t obtain one, keep backup proof (bank statement, credit card slip) and document your attempts to get a proper acknowledgment.
Q: How long should I keep records?
A: Keep records for at least three years after filing, but retain appraisals and documents for noncash gifts longer (seven years is prudent) if they supported a material deduction.
Professional disclaimer
This article explains general IRS substantiation rules as of 2025 and is for educational purposes only. It does not replace personalized advice from a qualified tax professional. For specific tax planning, appraisal requirements, or complex gifts (real estate, business interests, large appraisals), consult your CPA, tax attorney, or qualified appraiser.
For deeper planning strategies, see our guide on “Bunching Charitable Donations: A Practical Guide for Itemizers” and related tax‑efficient giving tactics available on FinHelp.io.
