What tax information do you need to know about when donating?

By Dr. Ann Echols
November, 2022
Donated Goods


When a donation of goods (or an item) is made, it is typically up to the donor to substantiate the value of the item or goods donated. Coming up with a value for used usable goods can be subjective.

To help donors value their donations of used usable goods, these sources may be helpful.

The Salvation Army offers this guide for valuing used usable goods: https://satruck.org/Home/DonationValueGuide

Goodwill Industries also has a donation-suggestion value guide: https://goodwillnne.org/donate/donation-value-guide/

The IRS advises using the Fair Market Value (FMV) of the donated item: https://www.irs.gov/publications/p561

This is one document that outlines how the IRS determines the FMV of donated goods or property: https://www.irs.gov/pub/irs-prior/p561--2000.pdf

All donors of goods may appreciate reading this pdf: https://www.irs.gov/pub/irs-pdf/p526.pdf and perusing this IRS link: https://www.irs.gov/forms-pubs/about-publication-526

If the donor chooses to submit the value of their donated goods on their 1040 personal tax return, and if that tax return gets audited, then it is up to the donor to substantiate the value claimed. Hence, using websites like the above for small value items and printing the website and noting the date printed as a backup for the value of your donated good(s), or saving the actual receipts for newly purchased items (like toilet paper, cleaning supplies, gifts donated to an auction, etc.) is recommended.

The organization receiving the donation should issue a receipt that the donor should keep especially if the donation is claimed on his/her tax return. Example blank forms that nonprofits may wish to use may be found on this site “5 Donation Receipt Templates: Free to Use for Any Charitable Gift”: https://charity.lovetoknow.com/Charitable_Donation_Receipt

The above link suggests that when the organization is creating a receipt for donated goods, they should include the following information:

  • Name of the organization

  • A statement stating that the organization is a registered 501(c)(3) organization along with its federal tax identification number

  • Date that the donation occurred

  • Donor’s name

  • Type of contribution made (EX: 5 pairs of jeans, 3 winter coats, 2 backpacks in good condition)

  • Value of the contribution (often the donor is responsible for this; FMV)

  • If anything was received in exchange for the donation (or state: "No goods or services were exchanged for this donation.") Note: charitable organizations should be aware of offering low-cost items of relatively insubstantial value: https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-contributions-quid-pro-quo-contributions

  • Name and signature of an authorized representative of the organization


  • Charities: Think about including some background details about your organization and your mission. This can be important for the donor and can help them feel appreciated, and it may encourage repeat donations.

If you donated an item or property worth $5,000 or more, then you must complete Section B of Form 8283 for each item or group of similar items for which you claim a deduction of over $5,000. The organization that received the property must complete and sign Part V of Section B, Form 8283. Find form 8283 here: https://www.irs.gov/pub/irs-pdf/f8283.pdf And, information about filling out form 8283 here: https://www.irs.gov/forms-pubs/about-form-8283

Donations of cash are not the same as donations of used or new goods. For cash donations, the IRS requires that the charity receiving the donation of $250 or more offer written substantiation of the donation, following these guidelines here: https://www.irs.gov/charities-non-profits/contributors/cash-donations. See also: Charitable Contributions - Written Acknowledgments | Internal Revenue Service https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-contributions-written-acknowledgments

Obviously, if you donate a lot of used usable goods, you will have a lot of paperwork. Most people do not donate enough used usable goods, or newly purchased supplies and smaller valued items (like paper towels, cans of food, cleaning products, etc.) to claim their donation on their tax return.

This blog does not constitute legal advice or that of a CPA. But it does contain some concepts to think about for donors of goods to consider when they give items in lieu of money.

Donated Goods