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previous page Previous Page: Publication 17 - Your Federal Income Tax - Contributions You Cannot Deduct
next page Next Page: Publication 17 - Your Federal Income Tax - When To Deduct
 Use previous pagenext page to find additional occurrences of topic items.Index for this Publication
taxmap/pub17/p17-131.htm#en_us_publink100034143

Contributions 
of Property(p162)


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If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution. However, if the property has increased in value, you may have to make some adjustments to the amount of your deduction. See Giving Property That Has Increased in Value, later.
For information about the records you must keep and the information you must furnish with your return if you donate property, see Records To Keep and How To Report, later.
taxmap/pub17/p17-131.htm#en_us_publink100034144

Clothing and household items.(p162)


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You cannot take a deduction for clothing or household items you donate unless the clothing or household items are in good used condition or better.
taxmap/pub17/p17-131.htm#en_us_publink100096394

Exception.(p162)
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You can take a deduction for a contribution of an item of clothing or household item that is not in good used condition or better if you deduct more than $500 for it and include a qualified appraisal of it with your return.
taxmap/pub17/p17-131.htm#en_us_publink100034145

Household items.(p162)
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Household items include:
Household items do not include:
taxmap/pub17/p17-131.htm#en_us_publink100034147

Cars, boats, and airplanes.(p162)


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The following rules apply to any donation of a qualified vehicle.
A qualified vehicle is:
taxmap/pub17/p17-131.htm#en_us_publink100067678

Deduction more than $500.(p162)


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Deduction more than $500.

If you donate a qualified vehicle to a qualified organization and you claim a deduction of more than $500, you can deduct the smaller of:
taxmap/pub17/p17-131.htm#en_us_publink100034149

Form 1098-C.(p162)
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You must attach to your return the copy of the Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes, (or other statement containing the same information as Form 1098-C) you received from the organization. The Form 1098-C (or other statement) will show the gross proceeds from the sale of the vehicle.
If you do not attach Form 1098-C (or other statement), you cannot deduct your contribution. You must get Form 1098-C (or other statement) within 30 days of the sale of the vehicle. But if exception 1 or 2 (described next) applies, you must get Form 1098-C (or other statement) within 30 days of your donation.
taxmap/pub17/p17-131.htm#en_us_publink100034150

Exceptions.(p162)


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There are two exceptions to the rules just described for deductions of more than $500.
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Exception 1—vehicle used or improved by organization.(p162)
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If the qualified organization makes a significant intervening use of or material improvement to the vehicle before transferring it, and you claim a deduction of more than $500, you generally can deduct the vehicle's fair market value at the time of the contribution. But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value, later. The Form 1098-C (or other statement) will show whether this exception applies.
taxmap/pub17/p17-131.htm#en_us_publink100034152

Exception 2—vehicle given or sold to needy individual.(p163)
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If the qualified organization will give the vehicle, or sell it for a price well below fair market value, to a needy individual to further the organization's charitable purpose, and you claim a deduction of more than $500, you generally can deduct the vehicle's fair market value at the time of the contribution. But if the vehicle's fair market value was more than your cost or other basis, you may have to reduce the fair market value to get the deductible amount, as described under Giving Property That Has Increased in Value, later. The Form 1098-C (or other statement) will show whether this exception applies.
This exception does not apply if the organization sells the vehicle at auction. In that case, you cannot deduct the vehicle's fair market value.
taxmap/pub17/p17-131.htm#en_us_publink100034153

Example.(p163)

Anita donates a used car to a qualified organization. She bought it 3 years ago for $9,000. A used car guide shows the fair market value for this type of car is $6,000. However, Anita gets a Form 1098-C from the organization showing the car was sold for $2,900. Neither exception 1 nor exception 2 applies. If Anita itemizes her deductions, she can deduct $2,900 for her donation. She must attach Form 1098-C and Form 8283 to her return.
taxmap/pub17/p17-131.htm#en_us_publink100055261

Deduction $500 or less.(p163)


rule
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Deduction $500 or less.

If the qualified organization sells the vehicle for $500 or less and exceptions 1 and 2 do not apply, you can deduct the smaller of:
If the vehicle's fair market value is at least $250 but not more than $500, you must have a written statement from the qualified organization acknowledging your donation. The statement must contain the information and meet the tests for an acknowledgment described under Deductions of At Least $250 But Not More Than $500 under Records To Keep, later.
taxmap/pub17/p17-131.htm#en_us_publink100034155

Partial interest in property.(p163)


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Generally, you cannot deduct a charitable contribution of less than your entire interest in property.
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Right to use property.(p163)
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A contribution of the right to use property is a contribution of less than your entire interest in that property and is not deductible. For exceptions and more information, see Partial Interest in Property Not in Trust in Publication 561.
taxmap/pub17/p17-131.htm#en_us_publink100034157

Future interests in tangible personal property.(p163)


rule
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Future interests in tangible personal property.

You may be able to deduct the value of a charitable contribution of a future interest in tangible personal property only after all intervening interests in and rights to the actual possession or enjoyment of the property have either expired or been turned over to someone other than yourself, a related person, or a related organization.
taxmap/pub17/p17-131.htm#en_us_publink100034158

Tangible personal property.(p163)
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This is any property, other than land or buildings, that can be seen or touched. It includes furniture, books, jewelry, paintings, and cars.
taxmap/pub17/p17-131.htm#en_us_publink100034159

Future interest.(p163)
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This is any interest that is to begin at some future time, regardless of whether it is designated as a future interest under state law.
taxmap/pub17/p17-131.htm#en_us_publink100034160

Determining 
Fair Market Value(p163)


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This section discusses general guidelines for determining the fair market value of various types of donated property. Publication 561 contains a more complete discussion.
Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts.
taxmap/pub17/p17-131.htm#en_us_publink100034161

Used clothing and household items.(p163)


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Used clothing and household items.

Generally, the fair market value of used clothing and household goods is far less than its original cost.
For used clothing, you should claim as the value the price that buyers of used items actually pay in used clothing stores, such as consignment or thrift shops. See Household Goods in Publication 561 for information on the valuation of household goods, such as furniture, appliances, and linens.
taxmap/pub17/p17-131.htm#en_us_publink100034162

Example.(p163)

Dawn Greene donated a coat to a thrift store operated by her church. She paid $300 for the coat 3 years ago. Similar coats in the thrift store sell for $50. The fair market value of the coat is reasonably determined to be $50. Dawn's donation is limited to $50.
taxmap/pub17/p17-131.htm#en_us_publink100034163

Cars, boats, and airplanes.(p163)


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If you contribute a car, boat, or airplane to a charitable organization, you must determine its fair market value. Certain commercial firms and trade organizations publish used car pricing guides, commonly called "blue books," containing complete dealer sale prices or dealer average prices for recent model years. The guides may be published monthly or seasonally and for different regions of the country. These guides also provide estimates for adjusting for unusual equipment, unusual mileage, and physical condition. The prices are not "official" and these publications are not considered an appraisal of any specific donated property. But they do provide clues for making an appraisal and suggest relative prices for comparison with current sales and offerings in your area.
taxmap/pub17/p17-131.htm#en_us_publink100034164

Example.(p163)

You donate a used car in poor condition to a local high school for use by students studying car repair. A used car guide shows the dealer retail value for this type of car in poor condition is $1,600. However, the guide shows the price for a private party sale of the car is only $750. The fair market value of the car is considered to be $750.
taxmap/pub17/p17-131.htm#en_us_publink100034165

Large quantities.(p163)


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If you contribute a large number of the same item, fair market value is the price at which comparable numbers of the item are being sold.
taxmap/pub17/p17-131.htm#en_us_publink100034166

Giving Property That 
Has Decreased in Value(p163)


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If you contribute property with a fair market value that is less than your basis in it, your deduction is limited to its fair market value. You cannot claim a deduction for the difference between the property's basis and its fair market value.
taxmap/pub17/p17-131.htm#en_us_publink100034167

Giving Property That 
Has Increased in Value(p163)


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If you contribute property with a fair market value that is more than your basis in it, you may have to reduce the fair market value by the amount of appreciation (increase in value) when you figure your deduction.
Your basis in property is generally what you paid for it. See chapter 13 if you need more information about basis.
Different rules apply to figuring your deduction, depending on whether the property is:
taxmap/pub17/p17-131.htm#en_us_publink100034168

Ordinary income property.(p163)


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Property is ordinary income property if its sale at fair market value on the date it was contributed would have resulted in ordinary income or in short-term capital gain. Examples of ordinary income property are inventory, works of art created by the donor, manuscripts prepared by the donor, and capital assets (defined in chapter 14) held 1 year or less.
taxmap/pub17/p17-131.htm#en_us_publink100034169

Amount of deduction.(p163)
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The amount you can deduct for a contribution of ordinary income property is its fair market value minus the amount that would be ordinary income or short-term capital gain if you sold the property for its fair market value. Generally, this rule limits the deduction to your basis in the property.
taxmap/pub17/p17-131.htm#en_us_publink100034170

Example.(p163)

You donate stock that you held for 5 months to your church. The fair market value of the stock on the day you donate it is $1,000, but you paid only $800 (your basis). Because the $200 of appreciation would be short-term capital gain if you sold the stock, your deduction is limited to $800 (fair market value minus the appreciation).
taxmap/pub17/p17-131.htm#en_us_publink100034171

Capital gain property.(p163)


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Property is capital gain property if its sale at fair market value on the date of the contribution would have resulted in long-term capital gain. It includes capital assets held more than 1 year, as well as certain real property and depreciable property used in your trade or business and, generally, held more than 1 year.
taxmap/pub17/p17-131.htm#en_us_publink100034172

Amount of deduction — general rule.(p163)
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When figuring your deduction for a gift of capital gain property, you generally can use the fair market value of the gift.
taxmap/pub17/p17-131.htm#en_us_publink100034173

Exceptions.(p164)
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In certain situations, you must reduce the fair market value by any amount that would have been long-term capital gain if you had sold the property for its fair market value. Generally, this means reducing the fair market value to the property's cost or other basis.
taxmap/pub17/p17-131.htm#en_us_publink100034174

Bargain sales.(p164)


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A bargain sale of property to a qualified organization (a sale or exchange for less than the property's fair market value) is partly a charitable contribution and partly a sale or exchange. A bargain sale may result in a taxable gain.
taxmap/pub17/p17-131.htm#en_us_publink100034175

More information.(p164)


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For more information on donated appreciated property, see Giving Property That Has Increased in Value in Publication 526.
previous pagePrevious Page: Publication 17 - Your Federal Income Tax - Contributions You Cannot Deduct
next pageNext Page: Publication 17 - Your Federal Income Tax - When To Deduct
 Use previous pagenext page to find additional occurrences of topic items.Index for this Publication