Donations to a non-profit organization are eligible for tax deductions.
Nonprofit organizations need donors like a fish needs water. Fortunately for those who like to give, charitable donations are tax-deductible as long as they are itemized and recorded. In order to realize this benefit, the donor must receive a properly written receipt as record of the transaction. These can be given in the form of an email, a postcard or a written document from the nonprofit organization.
Instructions
1. Have the items that were donated assessed by someone who knows the item well. This need not be a complicated process. But you want to make sure that the donor can deduct the full amount of the value of the donation. Talk to a mechanic, for example, to discuss the value of a donated used car. You'll need this information for the receipt.
2. Count any cash that was donated and make a copy of other monetary donations, such as checks or money orders. Keep the copies for the organization's records.
3. Write down the donor's name, address and telephone number at the top of the document. Use the donor's full legal name for tax purposes.
4. Give a brief description of what was donated to the nonprofit and list the value of it. A brief sentence and a dollar amount will suffice.
5. State the date that the donation was made. If details are unknown, list the month and year.
6. Mention whether or not anything was exchanged as a result of the donation. For example, if an individual donated $500 and received a stereo in exchange, this exchange must be included in the receipt. When donations are exchanged for another item or service, the donor can only deduct the amount of the difference. So, if the stereo received cost $150, the donor may claim only $350 out of the $500 donation for a tax deduction.
7. Have the receipt printed on company letterhead. At the very least, have it signed by the director or a member of the board.
