Discussion:Miscelleneous Donations
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Www.cpa1.biz (talk|edits) said: | 7 November 2006 |
| Almanacers,
My client's cash donation account detail has some entries that I do not know what organizations they were for. Can I group all of the cash donations and put them as Misc. Donations where it says donee in the software? Also, if my client has like 50 organizations that she has donated to, do I have to put ALL 50 of those donees in the tax software or is there away to consolidate this amount into one donation amount per the tax return. Thanks you all, Bj | |
Bottom Line (talk|edits) said: | 7 November 2006 |
| How much money are we talking? Had one that sent $10 to every televangelist out there. I grouped those. I would separate large ones ($500+). I believe IRS.gov has a list of 501c3's. You may want to spot check some of them especially if you find something like Bob's Church and Mini-Market. | |
| 7 November 2006 | |
| Hi wow just starting out in business (sorry for the sarcasm :)) put down the total donations on sch A as one number dont need to list just have the support. see sch A instructions. bye | |
Www.cpa1.biz (talk|edits) said: | 7 November 2006 |
| Wes,
Thanks! I am new to the business. Ya, everytime I have a return I get skeptical on couple things that I need more justification on how it should be presented. Luckily, I have you all as good mentors and information givers. Take care, BJ | |
| 7 November 2006 | |
| Hi the tough part is is you really should go to work for a firm first and learn from someone who has been around. If you are worrying about this little stuff think about what you dont even address properly for your clients. I always say 75% is issue recognition and 25% looking up the answer. bye | |
Michaelstar (talk|edits) said: | 7 November 2006 |
| Actually cash donations are not really a deduction in my mind. Must have a cancelled check or some other type of acknowledgment from the charity/church. Anyone can say they donated $$ in cash - no way to back it up. I also think the less than $75 no receipt rule does not apply in this situation. | |
Taxguy1024 (talk|edits) said: | 7 November 2006 |
| You're correct, Michaelstar......with the new tax bill, you must be able to substantiate ALL donations. | |
| November 7, 2006 | |
| Actually, it's the taxpayer that must substantiate. If I had a taxpayer who represented to me that she had made cash contributions, I would inform her of the new requirements and let her make the decision of whether to report it or not. | |
Death&Taxes (talk|edits) said: | 7 November 2006 |
| That is an excellent point, Wes. I would also go so far as to do some returns by hand now, while you are gearing up. Trusting software without understanding the flow of forms can be dangerous. As to this issue, copy or scan the list and keep that copy, but only put the totals. Natalie, I am not sure that course will work unless the client spells out to you that he or she has a receipt. | |
| November 7, 2006 | |
| If the client represents that cash donations were made and that yes, receipts were kept, then I would include the deduction on the return. My interpretation of Michaelstar's post is that he would dismiss them automatically, which I would not do. | |
Michaelstar (talk|edits) said: | 7 November 2006 |
| Then re-read what I posted - it is not intended to confuse other readers. Cash donations imply NO receipt. If the t/p has a receipt - then it s/b allowed - otherwise no. I do not make the rules - just try to follow them | |
| 7 November 2006 | |
| I use ProSeries and when a client gives me a long list of donations I pull up a supporting statement for the total donations and show the following: LISTING INCLUDED WITH TAXPAYER COPY OF RETURN on one line and on the next line: TOTAL OF LISTED CHARITABLE AMOUNTS. Then I make a copy for my record. | |
| 7 November 2006 | |
| note that new rules that dissallow diary as proof of payment to charity doesn't take place until tax year 2007. | |
| 9 November 2006 | |
| Michaelstar, $20 dollars in cash placed in the tray at church each week with no receipts($20 x 50 weeks = $1,000) are not deductible as church donations? | |
| November 9, 2006 | |
| not next year without a receipt.... receipts for all donations starting 2007. Actually a cancelled check, back record or receipt with the organizations name date and amount. One of the little treasures under the Pension Protection Act of 2006.
Kiddie tax amounts change next year too, but I think that is seperate from the above Act. No let's see--how does that saying go.. better to give than receive, or better to receive than give..... | |
| November 9, 2006 | |
| to clarify above, this is effective for 2006 tax year returns, and by starting 2007 I mean the preparing of the 2006 which we do in 2007..... sorry for the confusion | |
| November 9, 2006 | |
| Scratch that- this does start in tax year 2007.
My new rule, no posts until after 6 a.m., brain not working before coffee connects..... | |
Death&Taxes (talk|edits) said: | 9 November 2006 |
| The receipt requirement is confusing: for all tax years beginning after 8/17/06 for Individuals. The non-cash good condition rules begin with contributions made after 8/17/06. | |
| 9 November 2006 | |
| Our clients are really going to love us when we let them know that all those last minute contributions to thrift stores etc won't do them any good, that is if I am understanding this correctly. Anyone know how the thrift stores etc will be able to place a value on donated items and provide with an exceptable receipt for audit purposes? Who is going to determine "good" condition rules. One person's junk is another person's treasure??? | |
| 9 November 2006 | |
| Our clients are really going to love us when we let them know that all those last minute contributions to thrift stores etc won't do them any good, that is if I am understanding this correctly. Anyone know how the thrift stores etc will be able to place a value on donated items and provide with an exceptable receipt for audit purposes? | |
