Tuesday, June 3, 2008
The Spring 2008 Statistics of Income Bulletin contains an informative discussion of the trend in noncash charitable contributions. All other things being equal (which they rarely are, I know), it is better to give property rather than cash because property donatins generally result in a deduction equal to fair market value, even if the property's appreciation has never been taxed. The report is being touted for its finding that car donations have significantly decreased since the Congress tightened the rules:
For Tax Year 2005, tax law changes altered thededuction rules for some charitable contributions. The most significant change was made to the deduction amount allowable for vehicle donations. In previous years, taxpayers could deduct the fair market value of the automobile. Starting in 2005, the deductible amount for most donated vehicles was changed to the lesser of the fair market value or the gross proceeds from the sale of the vehicle by the donee.
But there is a wealth of other statistical data useful for those researching or studying the charitable contribution deduction.