Having incomplete substantiation of donations when filing nixes a deduction for the contributions, according to the Tax Court. Here’s what happened: A couple made regular gifts of $250 or more to their church. However, the acknowledgment from the church failed to state that no goods or services were given for the donation–I see this a lot. After the IRS denied their deduction because of the faulty acknowledgment, they got a letter from the church saying they received no benefits for the contributions. But that came too late. The deduction was propertly denied because the donors didn’t have a valid substantiation in hand before filing. Check your donation letters and if it doesn’t say “No Goods or Services Were Given for the Donation” have the organization reissue with this terminology.
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It’s Not What You Earn, But What You Keep, After Taxes.™ |
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