How to Calculate Values for Items Donated to Charities

How to Calculate Values for Items Donated to Charities. Cleaning out your closet and getting rid of those old clothes and other accessories you no longer need can also provide a tax deduction for your income taxes as well as helping those in need. In order to do so, you must determine the fair market value of the items you are donating.

Visit a thrift store in your area and note the prices of items which are similar to the ones you are donating. This allows you to make the proper deductions by using an established price. Remember that the condition of the items also dictates the price.

Buy the local "Buy Lines" paper to compare your items to those being sold by other individuals. This procedure can also be used by checking your own local paper's classified ads to get a reasonable range of prices to utilize.

Find the original receipts of the items you are donating. If you have them, you can estimate the fair market value by taking 25 percent of the actual cost for each item for deduction purposes.

Go to the Salvation Army's website (see Resources). This site gives detailed information about many common items and their values. These prices are acceptable to the IRS and navigating the site is very easy

Grapple no more with how to value your donated items. Using a tax preparation software such as Turbo Tax is a good idea as they usually have an additional software item, such as "It's Deductible" in Turbo Tax (see Resources). This software allows you to enter the items you donated and the program generates the actual acceptable cost for deduction purposes.

Tips

  • Make sure you obtain a receipt for your donations from the charitable entity associated with the donations. This will most likely not be filled out as the organization does not take the responsibility for determining the fair market value of your items.

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