Cash Donation

Technical topics regarding tax preparation.
#21
CathysTaxes  
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Most churches give their members numbered envelopes to keep track of donations. Or they can write a check. I can't believe someone goes to the ATM, withdraws the cash, and makes a donation unless they don't plan to deduct it.
Cathy
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#22
Nilodop  
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No, irs hasn't accepted contemporaneous written record since 2005. Bank record or receipt has been required starting in 2006. I did not know that. I retired years before that. Wonder why they didn't cross-reference to the change from -13.
 

#23
Joan TB  
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Slippery Pencil: I would also like to know where I can find the 2005/2006 change about the record keeping. I am absolutely not questioning it - in fact, that is what I thought it was. But when I did my (little bit) of research, the 1.170A-13 is what I found, with no reference to later changes.

I know that my legal research skills are not strong, so I just want to learn. Baby steps.....
 

#24
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As a tax preparer, I don't believe requesting donation receipts for small cash donations makes any sense. EVERY deduction requires a receipt / substantiation, the only issue here is that W-2 employee - individuals generally don't have the opportunity to deduct everything that a business is allowed to deduct...hence the recordkeeping requirements were created (they already existed for business taxpayers). And the case with the unfortunate couple in TX(?) that donated over $20k in a given year (I think), maintained copies of cancelled checks, and didn't get a piece of paper with the right verbiage by the time their return was filed...poorly decided, in my view (with every other financial system requiring tax reporting, why not throw houses of worship into the mix?)...

If you feel obligated (don't ask me why) or you literally believe your client is lying to you, ask for the receipt for such a small, routine amount. By all means remind the taxpayer of the recordkeeping / receipt requirements - and with their thumbs-up, note it in your tax file and move on.

I still can't believe $2k of donations is a concern - I'd recommend going to the average larger church in your area, becoming a member, and volunteering as a collections-counter (a win-win, you won't have to listen to the preacher)...you'll be amazed how much cash is donated every week.

And not to mention, it'll (apparently) blow minds to see how many folks who make $100k a year hand over an actual tithe annually...
 

#25
Nilodop  
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JoanTB, the change was in 2018 with an option of applying it back to 2006.
(h) Effective/applicability date. This section applies to contributions made after July 30, 2018. Taxpayers may rely on the rules of this section for contributions made in taxable years beginning after August 17, 2006.

[T.D. 9836, 83 FR 36422, July 30, 2018]


It implements section 170(f)(17), which was passed in 2006.
I. Cash, Check, or Other Monetary Gift Substantiation Requirements
Section 1.170A–15 implements the requirements of section 170(f)(17) for cash, check, or other monetary gift contributions, as added by the PPA, and clarifies that these rules supplement the substantiation rules in section 170(f)(8).


(17) Recordkeeping
No deduction shall be allowed under subsection (a) for any contribution of a cash, check, or other monetary gift unless the donor maintains as a record of such contribution a bank record or a written communication from the donee showing the name of the donee organization, the date of the contribution, and the amount of the contribution.
 

#26
Jake  
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The only criticism I have of the charitable giving substantiation requirement is the requirement that the taxpayer have that in hand by the due date of the tax filing.
 

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