Making gifts to charity is one of the most popular ways people use to cut their taxes. But to make sure you get the tax break you deserve when you make a gift to charity, you need to know the IRS rules that tell you what records you need to keep.
In the following video, Dan Caplinger, The Motley Fool's director of investment planning, talks about the documentation requirements for making deductible charitable gifts. Dan notes that for any monetary gift, it's important to have a bank record or written communication verifying the gift. For gifts of $250 or more, you need to receive a written acknowledgment of the contribution from the charitable organization. Dan notes that for big gifts of property above $5,000, you need a qualified appraisal to justify the amount taken. Dan concludes by noting that special rules exist for gifts of motor vehicles, which have gotten increasingly popular but were also popular targets for abuse.
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Neither The Motley Fool nor Fool contributor Dan Caplinger has any position in any stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.