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Goodwill is famously known to be a non-profit organization existing in the United States and Canada. People, who turn to Goodwill for support including the disabled, under-educated and underprivileged, rely on donations by other people. They do not only accept food and clothes but also furniture, computers, recreational and study materials and monetary donations. Goodwill offers to provide receipts to people who might need them. Most people overlook getting their receipts when making donations because it is for charity after all; however, what most people do not know is that it is possible to get Goodwill donation tax deductions. You might be lazy to clean out your closet or your basement but with the generous tax deductions that you might earn, Goodwill might just seem to be the encouragement that you need.

Follow the steps listed below to ensure that you get the proper tax deductions.

1. If you decide that you will itemize your taxes, the deductions will be standard. Therefore, including your Goodwill donation in the list of your itemized deductions may less than likely to be significant.

2. Organize your donations to Goodwill. Do not just put them in bags and decide to identify them later on. These might cause confusion and result to incomplete documentation that needs to be presented to the IRS. So, before you bring your donations, list them down. It would be better if you could create a spreadsheet so you can keep track of them better. Make sure that you include in the spreadsheet the items that you donated, their purchase prices, the approximate dates of purchase, their conditions and the donation date.

3. Goodwill, as well as the IRS only accept donations that are in good condition. So before you bring your items, make sure to double check them. As much as possible avoid donating socks and underwear unless they are newly bought.

4. When you decide to donate some items that are relatively high-priced, document them. Take pictures of them especially if these items include furniture, computers, television sets or other electronics. Designer clothes that are going to be donated need not be documented; because even though they are expensive, they share the same market value as clothes bought at outlet stores.

5. To complete your spreadsheet, it is recommended to go to the Goodwill website and take a look at the chart that contains the list of the fair market value of common items. Make sure to use the values listed on there to fill up your spreadsheet. Yes, some of the values might seem to be extremely low, however, factors such as the condition, age and scarcity of the items are considered in the determination of their market values.

6. Goodwill donations usually have drop off boxes to make it easier and convenient for their donors. If you wish to get a receipt though, before you go, call the Goodwill store nearest you so you are assured that there will be a person available to give you your receipt. Moreover, opt to drop off your donations during regular store hours.

7. When you get to the Goodwill store, make sure that you ask for a receipt yourself as some of them might have gotten used to people who do not ask for one. Moreover, when your receipt is handed to you, check it. Some just write in general, stating that you donated one box. This is where your spreadsheet will come in handy. You can show them your list to make it easier for them to write down what should be included in your receipt.

8. Another reason why you should keep track of your donations is this, the IRS requires you to record your donations on the Schedule A of IRS Form 1040. If you happen to donate more than $500 worth of goods, then you are also required to complete Section A of Form 8283 which is called the “Non Cash Charitable Contributions”.

9. The IRS has a limit to Goodwill tax deductions. If you happen to donate more than 50 percent of your adjusted gross income, you cannot claim your tax return beyond the 50 percent limit in the same year; however, it can be carried over to your next year’s tax return.

10. If you donated more than $5000 to Goodwill, your donations must be appraised by a qualified appraiser on Form 8283 Section B and he or she must fill out Part 3 of the Form which is the “Declaration of Appraiser”.

11. The final step would be is to complete the necessary documents which include Form 1040, Form 8283, the receipts given by Goodwill and the spreadsheet containing the year’s tax return. Always double check the items stated in your documents to avoid problems.

Donating is never a burden, taxes are; but with Goodwill donation tax reductions, not only will you be able to help out other people but you are also given the chance to make a tax break work for you. Get your credit report checked before you make the final list of your itemized deductions to make sure that you do not overlook an item that is deductible.