Good Records Protect Good Intentions

When it comes to taxes, details matter. Maintaining the proper records can be the difference between receiving a tax benefit and losing it entirely. 

 
Tax Insight: For charitable contributions of $250 or more, the IRS generally requires a written acknowledgment from the charitable organization. The acknowledgment must confirm: 
 
-The amount or description of the donation. 
-The date of the contribution. 
-Whether any goods or services were received in exchange for the donation. 

Without this documentation, a deduction may be denied, regardless of the value of the gift or the donor's intent. 
 

Business Thought: Many tax issues do not arise because a deduction was improper. They arise because documentation was incomplete, missing, or obtained too late. 
 

News Reaction: Two taxpayers lost a charitable deduction worth $665,000 because they did not obtain the specific written acknowledgment required by the IRS, despite having an appraisal and other supporting documents. 

 
This is an example of how a valuable tax deduction can be lost over a small paperwork mistake. Strong recordkeeping is one of the simplest ways to reduce tax risk. 

 
Need help organizing your records or planning for taxes?