Charitable Deduction Question

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OldSport
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Charitable Deduction Question

Post by OldSport » Sun Dec 24, 2017 11:10 pm

If I write and mail a check to a charity, what is the effective date for tax deductibility: the date I write and mail the check, the date the charity cashes the check, the date the funds clear my account, or some other date?

I want to donate to a particular charity, but it does not have a secure and reliable means to donate online, the only practical means is to write and mail a physical check, but I want to be able to deduct taxes for 2017.

Given the nature of this charity and time of year, there is a good chance they will not cash this until 2018 if I were to date and mail the check on Tues Dec 26. Can I still deduct this for 2017?

Katietsu
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Re: Charitable Deduction Question

Post by Katietsu » Sun Dec 24, 2017 11:17 pm

The best option is to get it postmarked by Dec. 31 and you will have complied with the regulations which allow a 2017 Tax year deduction.

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One Ping
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Re: Charitable Deduction Question

Post by One Ping » Sun Dec 24, 2017 11:20 pm

Katietsu wrote:
Sun Dec 24, 2017 11:17 pm
The best option is to get it postmarked by Dec. 31 and you will have complied with the regulations which allow a 2017 Tax year deduction.
Just curious ... if the need arises, how do you 'prove' to the IRS it was postmarked in 2017?
"Re-verify our range to target ... one ping only."

Lafder
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Re: Charitable Deduction Question

Post by Lafder » Sun Dec 24, 2017 11:21 pm

Send it registered or is it certified ? with proof of recipient address and postmark :)

The post office can direct you to the correct form.

lafder

aristotelian
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Re: Charitable Deduction Question

Post by aristotelian » Sun Dec 24, 2017 11:22 pm

Maybe request a confirmation letter specifying the donation was made in 2017? I do believe if you drop it in the mail Tuesday morning it should get there in time.

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One Ping
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Re: Charitable Deduction Question

Post by One Ping » Sun Dec 24, 2017 11:23 pm

Lafder wrote:
Sun Dec 24, 2017 11:21 pm
Send it registered or is it certified ? with proof of recipient address and postmark :)

The post office can direct you to the correct form.

lafder
That would prove when the recipient received it, does it also include information on when it was sent?
"Re-verify our range to target ... one ping only."

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The529guy
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Re: Charitable Deduction Question

Post by The529guy » Sun Dec 24, 2017 11:26 pm


tomd37
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Re: Charitable Deduction Question

Post by tomd37 » Sun Dec 24, 2017 11:26 pm

Per IRS Publication 17, Chapter 24, Contributions, page 169 "A check you mail to a charity is considered delivered on the date you mail it." Merry Christmas and thanks for the contribution to a charitable organization.
Tom D.

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One Ping
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Re: Charitable Deduction Question

Post by One Ping » Sun Dec 24, 2017 11:31 pm

The529guy wrote:
Sun Dec 24, 2017 11:26 pm
Certificate of Mailing?
I did not know about the Certificate of Mailing! Thanks, 529guy.
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carolinaman
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Re: Charitable Deduction Question

Post by carolinaman » Mon Dec 25, 2017 6:52 am

The529guy wrote:
Sun Dec 24, 2017 11:26 pm
Certificate of Mailing?
529,
Thanks for sharing this. For $1.35 I can have proof when I mail a letter. Some charities are pretty slack about donations and this could be worthwhile.

gd
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Re: Charitable Deduction Question

Post by gd » Mon Dec 25, 2017 7:05 am

Curious, we've never known about or been offered the Certificate of Mailing despite numerous discussions about such things at my local post office. We sometimes buy the postage on a specific letter, which (at least in our PO) produces a receipt mentioning the zip code it goes to. I believe that'd be considered reasonable evidence unless an auditor's on a vendetta.

fundseeker
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Re: Charitable Deduction Question

Post by fundseeker » Mon Dec 25, 2017 8:42 am

This information is huge!!! Thanks, Katietsu! I wonder if it would help to change the title to include maybe "Mailing by 31st is acceptable." So those who became more informed over the weekend still apparently have time to donate using checks.

But, I wonder if the postmark will satisfy the IRS when donating appreciated shares? I am concerned because donating shares of mutual funds does not seem to fall into a topic specifically addressed by IRS Pub 526.

What if IRS wants to put it in the "Stock Certificates" category and disallow those postmarked by or before December 31, if the broker does not complete it until January 2018? Here is an excerpt from the 2016 publication (link at the end, see page 13), the latest I found on the Internet:

"Time of making contribution.

Usually, you make a contribution at the time of its unconditional delivery.

Checks. A check you mail to a charity is considered delivered on the date you mail it.

Text message. Contributions made by text message are deductible in the year you send the text message if the contribution is charged to your telephone or wireless account.

Credit card. Contributions charged on your bank credit card are deductible in the year you make the charge.

Pay­by­phone account. Contributions made through a pay­by­phone account are considered delivered on the date the financial institution pays the amount. This date should be shown on the statement the financial institution sends you.

Stock certificate. A properly endorsed stock certificate is considered delivered on the date of mailing or other delivery to the charity or to the charity's agent. However, if you give a stock certificate to your agent or to the issuing corporation for transfer to the name of the charity, your contribution isn't delivered until the date the stock is transferred on the books of the corporation.

Promissory note. If you issue and deliver a promissory note to a charity as a contribution, it isn't a contribution until you make the note payments.

Option. If you grant a charity an option to buy real property at a bargain price, it isn't a contribution until the charity exercises the option.

Borrowed funds. If you contribute borrowed funds, you can deduct the contribution in the year you deliver the funds to the charity, regardless of when you repay the loan.

Conditional gift. If your contribution depends on a future act or event to become effective, you can't take a deduction unless there is only a negligible chance the act or event won't take place. If your contribution would be undone by a later act or event, you can't take a deduction unless there is only a negligible chance the act or event will take place."

https://www.irs.gov/pub/irs-pdf/p526.pdf

Swansea
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Re: Charitable Deduction Question

Post by Swansea » Mon Dec 25, 2017 8:52 am

For cash donations of $250 or more, a letter from the charity acknowledging receipt on a date in the same year as the check, would also serve as proof. Now as it gets close to the end of the year, a timely, dated letter becomes problematic.

runner3081
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Re: Charitable Deduction Question

Post by runner3081 » Tue Dec 26, 2017 11:18 am

Throw it in a flat-rate priority mail envelope and send it off. This comes with tracking (which included the initial scan when you hand it off) and costs around $5 to mail.

Admiral
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Re: Charitable Deduction Question

Post by Admiral » Tue Dec 26, 2017 12:20 pm

It's based on when it's given/sent, not when it's received, for your reporting purposes. If it wasn't, you could have a situation where you sent a check in July and the charity sat on it and reported it in January of the following year.

We just put everything on a credit card so the charge shows up on or before December 31. Easiest way to keep track.

Yankuba
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Re: Charitable Deduction Question

Post by Yankuba » Tue Dec 26, 2017 1:16 pm

All my charities accept credit cards or PayPal. It's almost 2018!!!

HIinvestor
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Re: Charitable Deduction Question

Post by HIinvestor » Tue Dec 26, 2017 1:25 pm

Most charities are happy to send a letter indicating you donated $$$$$ in whichever year you’d like them to credit you for. They can send you the letter in Habuary, Thanksgiving ng you for the $$$ donation in 2017.

InMyDreams
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Re: Charitable Deduction Question

Post by InMyDreams » Fri Jan 05, 2018 6:21 pm

fundseeker wrote:
Mon Dec 25, 2017 8:42 am
Time of making contribution.Usually, you make a contribution at the time of its uncondi­tional delivery.
....
Credit card. Contributions charged on your bank credit card are deductible in the year you make the charge.
https://www.irs.gov/pub/irs-pdf/p526.pdf
meaning a credit card contribution made online on 31 Dec 2017 is a 2017 contribution?

RudyS
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Re: Charitable Deduction Question

Post by RudyS » Fri Jan 05, 2018 10:47 pm

InMyDreams wrote:
Fri Jan 05, 2018 6:21 pm
fundseeker wrote:
Mon Dec 25, 2017 8:42 am
Time of making contribution.Usually, you make a contribution at the time of its uncondi­tional delivery.
....
Credit card. Contributions charged on your bank credit card are deductible in the year you make the charge.
https://www.irs.gov/pub/irs-pdf/p526.pdf
meaning a credit card contribution made online on 31 Dec 2017 is a 2017 contribution?
Yes, it's the date you made the charge, not the date you pay the bill.

InMyDreams
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Re: Charitable Deduction Question

Post by InMyDreams » Sat Jan 06, 2018 1:18 am

RudyS wrote:
Fri Jan 05, 2018 10:47 pm
InMyDreams wrote:
Fri Jan 05, 2018 6:21 pm
fundseeker wrote:
Mon Dec 25, 2017 8:42 am
Time of making contribution.Usually, you make a contribution at the time of its uncondi­tional delivery.
....
Credit card. Contributions charged on your bank credit card are deductible in the year you make the charge.
https://www.irs.gov/pub/irs-pdf/p526.pdf
meaning a credit card contribution made online on 31 Dec 2017 is a 2017 contribution?
Yes, it's the date you made the charge, not the date you pay the bill.
So, if the charitable organization gives a receipt dated for the day that they deposited/recorded the $$ to the account (not the date that the transaction was initiated), would a credit card statement showing when the transaction was initiated be sufficient proof?

RudyS
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Re: Charitable Deduction Question

Post by RudyS » Sat Jan 06, 2018 10:00 am

InMyDreams wrote:
Sat Jan 06, 2018 1:18 am
RudyS wrote:
Fri Jan 05, 2018 10:47 pm
InMyDreams wrote:
Fri Jan 05, 2018 6:21 pm
fundseeker wrote:
Mon Dec 25, 2017 8:42 am
Time of making contribution.Usually, you make a contribution at the time of its uncondi­tional delivery.
....
Credit card. Contributions charged on your bank credit card are deductible in the year you make the charge.
https://www.irs.gov/pub/irs-pdf/p526.pdf
meaning a credit card contribution made online on 31 Dec 2017 is a 2017 contribution?
Yes, it's the date you made the charge, not the date you pay the bill.
So, if the charitable organization gives a receipt dated for the day that they deposited/recorded the $$ to the account (not the date that the transaction was initiated), would a credit card statement showing when the transaction was initiated be sufficient proof?
IRS Pub 17, P. 169: When to deduct:

Credit card. Contributions charged on your credit card are deductible in the year you make the charge.


The statement proves the date; the letter verifies that you received no benefit from the donation as well as perhaps detail about the recipient.

InMyDreams
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Re: Charitable Deduction Question

Post by InMyDreams » Sat Jan 06, 2018 10:44 am

Thank you!

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