When you make a donation to charity, you often receive a benefit in return.
Strategy: Obtain proof of your contribution and the value of the benefit. Generally, you can deduct the difference for such “quid pro quo contributions.”
For instance, if you attend a $100 per plate fundraising dinner and the meal is valued at $40, you can write off $60.
On the other hand, if you receive just a “low-cost item” like a pen or key chain, you may deduct the full amount of your donation.
- The item can’t cost the charity more than $10.60, and the contribution must be at least $53. Plus, it must bear the organization’s name or logo.
- The item’s fair market can’t exceed the lesser of $106 or 2% of your donation amount.
Tip: Coordinate quid pro quo contributions with other charitable gifts.