Charitable Income Tax Deductions for Used Clothing
- You can claim a tax deduction only if you donate the clothing to a qualified organization. A qualified organization is a nonprofit entity that serves a charitable, governmental, religious, civic or scientific purpose, such as a church, a school, the American Red Cross, or your local county government.
- You can claim a charitable contribution deduction only if you itemize your tax deductions. If you claim the standard deduction, you cannot also claim a deduction for your donated used clothing.
- Assuming you meet the first two requirements, you can claim a deduction equal to the fair market value of the used clothing. Fair market value is generally the price that the clothing would sell for on the open market.
- According to the IRS, "If you give used clothing to the Salvation Army, the [fair market value] would be the price that typical buyers actually pay for clothing of this age, condition, style and use. Usually, such items are worth far less than what you paid for them."
- The IRS does not provide a set formula for calculating the fair market value of used clothing. You must decide how much the clothing is worth, depending on such factors as how much you paid for the clothing and what condition the clothing is in. As long as you calculate the value to be less than $500, you do not need a professional appraisal.
- Since there is no set formula, there is no one right answer. If you bought a shirt two years ago for $40, wore it 20 times, it is still in fairly new condition with no tears or holes, and it is still in style, it probably would be reasonable to estimate its fair market value at around $10. For pricing help, you can check local consignment stores and consider their prices for used clothing.