Form 8283 is used to report non-cash charitable donations over $500. This blog post will focus on the most-common scenarios the typical taxpayer encounters: donating clothes to a charity such as Goodwill, and donations of stock. Form 8283 can be complex when you get into situations where an appraisal is required. This is not in my area of expertise, so I’m sticking to the basic situations.
Donating Clothes and Other Items to Charity
As long as the total amount of your non-cash donation is less than $5,000 of similar property, you only need to fill out Section A.
Let’s say you donated to Goodwill six different times during the year, and each donation was $100 (so a total of $600 for the year to Goodwill).
Each visit to Goodwill needs itemized on Section A of Form 8283, with the name of the organization, a description of what was donated, the date of the contribution, the date you acquired the property and how you acquired it (but only if the value of the donated items is more than $500), the market value of the things you donated, and how you determined the value.
Example
You donated $100 of good used shirts to Goodwill on June 7, 2017, and you donated a couch worth $600 to Goodwill on December 19, 2017. Your form 8283 will show the following:
The first donation goes on Line A and will have: Goodwill as the name of the organization (plus you’ll need to include the address); 1 bag of good used shirts as the description of the donation; June 7, 2017, as the date of the donation; $100 as the amount; and I typically put “thrift-shop value” for the method, assuming the taxpayer used an online valuation system to determine the value. Note that you don’t need to put the acquisition date or how it was acquired, because the amount is less than $500.
Now for the couch:
This will go on Line B. Goodwill is the name of the organization; “used couch” would seem to be an accurate description; December 19, 2017, is the date of the donation; $600 is the amount; because it’s more than $500 we have to list the date acquired, so you’d have to figure out that date and put it on the form; “how acquired” would most likely be “purchase;” you also have to put your cost basis, which is how much you paid for it originally; and then “thrift-shop value” or whatever method you used to determine that $600 was the appropriate deduction.
Stock Donation
As long as the stock you donated is publicly traded, the reporting is straightforward. You’ll fill in the same boxes in Part A, although (per the Form 8283 instructions) you can leave the cost basis field blank as long as you held the stock for more than 1 year. The “method” column will usually show “stock exchange average price.”
Complications
I do not have experience with Section B of Form 8283 so will not get deep into that section. For your average taxpayer, you could run into issues with needing to use Section B, where appraisals are required, if you’re donating a bunch of similar items, and the value exceeds $5,000. For example, maybe you donate an extensive collection of rare books to a library, and the value is more than $5,000. In that case, Section B would kick in.
IMPORTANT NOTE: publicly traded stocks can always be reported in Section A, even if the value of the stock is over $5,000.