Are you asking yourself, “How much tax can I claim for my mobile phone?” It is a valid question if you want to donate cell phones to Goodwill or other charity organizations. However, it might not be worth deducting the phone since you'd need to itemize to claim a non-cash charity deduction, and the standard deduction may work out better financially.
Cell Phone Donations
If you buy a new cell phone today, chances are there will be a newer model of that phone next year. Consumers who are looking for the latest technology might be eager to upgrade, but that leaves a huge number of older model cell phones collecting dust in dresser drawers, or worse taking up space in landfills.
You can help your community, reduce environmental waste and get a tax deduction by donating your old cell phone. Although you may not be able to gain much of a tax deduction if you donate flip phones or other older models, you will likely be able to enjoy substantial savings if you donate an iPhone to charity or other kinds of valuable technology.
Claiming Write-Offs as a Qualifying Organization
Giving your old cell phone to a needy individual is a worthy endeavor. It might help that person and give you a warm, fuzzy feeling, but it doesn't qualify for a tax deduction.
If you want to take a write-off for donating your cell phone, you must make the donation to a qualifying organization. Organizations that can enable you to get mobile phone tax deductions include religious organizations, educational organizations, government organizations, certain war veterans’ organizations and fraternal societies.Others include amateur athletic associations, scientific, literary or charitable organizations and societies for the prevention of cruelty to animals or children.
When in doubt, check with the IRS's online tool. Keep in mind, however, that this information is not meant to act as a cell phone donation value guide.
Explore Deduction Opportunities
Cell phones depreciate in value rapidly, especially after a new model of the same phone comes out. When you donate your old cell phone, you can't deduct the retail price you paid for the phone. For example, if you give away an iPhone, you can only deduct the iPhone fair market value.
The charitable organization you donate to might provide some guidance on how much the phone is worth, or it might leave the amount of the donation up to you.
The IRS considers fair market value to be the price a willing buyer would pay for the cell phone in its current condition. You can check the going rate for similar cell phones listed on online auction sites to get an idea of what they are selling for.
Read More: Form 1040: What You Need to Know
Evaluate Filing Requirements
You should keep records of all non-cash donations if you intend to donate cell phones for tax deductions. Ensure you detail the name of the organization, the date and locate of the donation and the value of your donated cell phone.
But if the fair market value of your donated cell phone is less than $250, you don't have to get a receipt if it is not practical to do so. For example, if you donate your old phone through an unmanned drop box at a donation center. If the value is $250 or more you must get a written acknowledgement from the charity.
If you want to take a tax write-off for your donated cell phone, you'll have to itemize your deductions on Schedule A of Form 1040. Add the amount of your cell phone donation to your other non-cash charitable contributions and report the total on Line 17.
If your total non-cash contributions exceed $500, you'll also need to attach Form 8283. If the total amount of your itemized deductions is less than your standard deduction, you'll get a lower tax obligation by choosing the standard deduction.
Mike Parker is a full-time writer, publisher and independent businessman. His background includes a career as an investments broker with such NYSE member firms as Edward Jones & Company, AG Edwards & Sons and Dean Witter. He helped launch DiscoverCard as one of the company's first merchant sales reps.