Baylor University
Tax & Compliance Accounting
Financial Services

Substantiation

Charitable Contribution of Less than $250

For a cash contribution that is less than $250, a donor must keep (1) a canceled check or legible and readable account statement satisfying IRS standards or (2) a receipt from the charitable organization including the name of the organization, the date of the contribution, and the amount of the contribution. It should be noted that the organization is under no obligation to supply such a receipt unless the donor requests such.

If a noncash contribution of less than $250 is given, the donor must attain a receipt from the organization including the name of the charitable organization, the date and location of the charitable contribution, and a reasonably detailed description of the property. The donor must also keep records including the following information: (1) the name and address of the organization, (2) the date and location of the contribution, (3) a reasonable description of the property, (4) the fair market value of the property on the contribution date and how it was calculated, (5) the cost or other basis of the property, (6) the amount claimed as a deduction, and (7) the terms of any conditions attached to the property. (Top)


Charitable Contribution of $250 - $500

IRC 170(f)(8) requires that donor must substantiate a charitable contribution of $250 or more by a contemporaneous written acknowledgement of the contribution by the donee organization for a charitable deduction to be allowed. It should be noted that there is no information reporting requirement on the charitable organization; instead the donor must request the acknowledgement. The contemporaneous written acknowledgement must include:

    1. the amount of cash given and a description (not including the value) of any property other than cash contributed by the donor

    2. whether the donee organization provided any goods/services in consideration, in whole or in part, as to the contribution, and

    3. a description and good-faith estimate of the value of any goods/services provided to the donor (listed under 2.), or if such goods/services consisted only of intangible religious benefits, a statement to that effect.

The statement will be considered contemporaneous if the donor attains it on or before the earlier of (1) the date the donor files his original return for the taxable year in which the donation was made or (2) the due date (including extensions) for filing his original return for that year. (Top)


Charitable Contribution of $500 - $5,000

If a deduction is claimed for a donation of property between $500 and $5,000, the donor must have the records and acknowledgement required under a charitable contribution of $250 - $500, but also must have records including the following information: (1) how the property was attained, (2) the approximate date the property was attained or completed, and (3) the cost or other basis of the property. (Top)


Charitable Contribution of Over $5,000

If a deduction is claimed for a donation of property of over $5,000, the donor must have the records and acknowledgement required under a charitable contribution over $500 - $5,000, and must also obtain a qualified written appraisal of the donated property from a qualified appraiser. IRS Publication 561 provides details and exemptions on certain types of property for such appraisals. It should be noted that it is not the responsibility of the charitable organization to attain this appraisal; instead it is the donor's responsibility. In addition, the charitable organization does not have to receive this appraisal; if provided, the charitable organization simply signs to acknowledge the property was received. (Top)