Estimating value of clothing to charity?

Karl F. Bloss

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Sep 19, 1996, 3:00:00 AM9/19/96

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This is probably in a FAQ somewhere, but I haven't found it:

How do I best estimate the value of clothing that I've finally gotten
around to boxing up for Goodwill or the Salvation Army? Is there a
standard value for each garment type or do I just have to get a $
value receipt from the charity?

Also, are there any pointers concerning how much I can typically
donate without raising some audit flags at the IRS? I've just been
too lazy to take all these clothes to the charity, so going from near
zero deduction to a whole bunch might seem suspicious.

Thanks,

-Karl
(please copy me via e-mail on any reply posts)

Dale Ross

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Sep 19, 1996, 3:00:00 AM9/19/96

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There are pointers to estimating the value of assets, such as
clothes. It is in the IRS publications and on the instructions to
Schedule A. You basically have to go with the thrift shop price,
which is very low. There is no standard value. If you think about it
a suit can be by Sears or by Armani and it's still a suit.
With regard to raising a red flag to the IRS. If you donate more than
a certain amount (they have been cracking down here and the numbers
have changed but its in the info described above) you must get a
receipt from the charity. As the value goes up, you need an appraisal.
I once tried to give a $7,000 work of art to a college but could not
get an appraiser to appraise it since the artist did not have a
secondary market. I could have chosen $5,000, which is the highest
not needing an appraisal but I decided this would raise a red flag.
You need to look at your income and total tax situation. The tax
programs (at least TurboTax) did (does) have this info built into the
program, so if you can get last year's version, which you should be
able to free from the company that may answer your question.
As a knowledgable guess, if one had an adjusted gross income (AGI) of
say $40,000, I think that $8,000 would not be a problem. Remember
that many people tithe to their church etc.
As for my guess, CPAs may disagree and they may know much more than I do.

TaxService

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Sep 20, 1996, 3:00:00 AM9/20/96

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In article <51qca2$p...@news.enter.net>, bl...@enter.net (Karl F. Bloss)
writes:

>How do I best estimate the value of clothing that I've finally gotten
>around to boxing up for Goodwill or the Salvation Army? Is there a
>standard value for each garment type or do I just have to get a $
>value receipt from the charity?
>
>Also, are there any pointers concerning how much I can typically
>donate without raising some audit flags at the IRS? I've just been
>too lazy to take all these clothes to the charity, so going from near
>zero deduction to a whole bunch might seem suspicious.
>

The fair market value of used clothing and other personal items is usually
far less than the price you paid for them. There are no fixed formulas or
methods for finding the value of items of clothing.

You should claim as the value the price that buyers of used items actually
pay in used clothing stores, such as consignment or thrift shops.

There are no special rules other than the suggestion above, for
determining value, but if non-cash gifts exceed $500. a special form
(8283) is required. If you have legitimate deductions, you shouldn't be
concerned about arousing suspicions. There are tables that exist which
give the norms for deductions as they relate to income in given years.
Red flags even appear in tax preparation packages, if it appears that the
figures are way out of line with the national norms. Frankly, I think the
figures are used as tools to sell commercial books! Personally, I don't
trust anything but what my clients tell me. I have many clients who tighe
@ 10% and have seen contributions fluctuate from a very small amount, in
one year, and escalate to thousands of dollars the next. One thing to
remember is that, when your deductions exceed certain limits, there are
special requirements for reporting.

Hope this helps!

"Jack"

John H. Fisher - TaxSe...@aol.com
Philadelphia, Pa. - Atlantic City, NJ - West Wildwood, NJ

Where ignorance is bliss, 'tis folly to be wise!!