Cleaning out closets and disposing of seldom-worn clothing is a chore that can be financially beneficial if you donate those clothes. Goodwill and The Salvation Army accept clean, gently used clothing. Other charitable organizations such as the Lupus Foundation of America periodically provide bags and schedule pickups of clothing and other items. It pays to keep track of clothing donations because they can be deducted on your income tax.
Estimate the value of your clothing donations according to charts provided by Goodwill. Men’s and women’s sweaters, for instance, range from $5 to $15. Men’s and women’s jeans range from $4 to $21. Children’s clothing estimates are less. The Salvation Army charts provide low and high estimates depending on the age and quality of the items. There are separate listings for children’s, men’s and women’s clothing with men’s overcoats, for example, ranging from $15 to $50 and women’s fur coats estimated at $25 to $400.
Visit local thrift shops or resale shops to get an idea of how clothing items similar to yours are priced.
Itemize deductions. You must file IRS Form 1040 and itemize deductions on Schedule A in order to deduct the fair market value of donated clothing. Fair market value is considered the amount that a willing buyer would pay for the item. You can’t deduct clothing donations if you take the standard deduction on your federal income tax.
Complete IRS Form 8283 Non-cash Charitable Contributions if the total of your non-cash deductions including clothing is more than $500. If the value of your clothing donations is more than $250, you must obtain a receipt from the charity.
