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Greetings, all, 2004 may be the first year I will be eligible to itemize due to buying a house. I file as single and in 2003 had $4750 worth of standard deduction that I could take. In 2004 I think the standard deduction will be at least this large, if not larger - I know it is indexed for inflation. Here are my questions:

1) There appears to be no benefit to itemizing unless my Schedule A result exceeds the standard deduction. My income for 2004 may be on the borderline of what would force a limitation on the allowed itemized deduction. Is there any similar limitation applied to the standard deduction based on income?

2) If I am eligible to get a benefit from itemizing, it would only be via interest on the mortgage, property taxes paid, state taxes paid (though I think I will now have to enter a figure for any refunds from the state elsewhere on my 1040) and charitable deductions. Since I will be paying interest on a mortgage for only 6 months of 2004, it might be tough to hit higher than $4750 even with property and state tax paid. The difference would have to come from charitable contributions. I see that if I exceed $500 in non-cash contributions I will have to fill out form 8283. It is possible that I WILL exceed $500 given that I am essentially doing a wholesale giveaway of tons o' stuff that has heretofore been sitting in my closets and on my bookshelves. I am using the program ItsDeductible to help me arrive at fair market value. What I want to know is whether I can use the printout from this program as an attachment to form 8283 to satisfy all the required disclosure. Looking over form 8283, I see questions being asked about when I acquired each donated item, as well as how I arrived at its fair market value. Assuming that I really am required to fill out 8283, how insistent is the IRS on having every bit of this detail so long as I have used the ItsDeductible software - which does not ask for this level of detail. Do I need to be taking digital photos of all my donated clothing and books?

Information about your own experiences with having non-cash deductions above $500 (necessitating form 8283) will be greatly appreciated. Thanks!

xraymd
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What I want to know is whether I can use the printout from this program as an attachment to form 8283 to satisfy all the required disclosure. Looking over form 8283, I see questions being asked about when I acquired each donated item, as well as how I arrived at its fair market value. Assuming that I really am required to fill out 8283, how insistent is the IRS on having every bit of this detail so long as I have used the ItsDeductible software - which does not ask for this level of detail. Do I need to be taking digital photos of all my donated clothing and books?

I also use Its Deductible for my charitable donations. Not sure if you realize this from the way your question is worded but the It's Deductible software does the form 8283 for you. You just print it out at the end of the year and attach to your tax forms.

Those questions about date acquired, how acquired, and adjusted basis (columns d, e, f on the 8283) only have to be answered for any item you donated worth over $500 (not total value over $500). I have never had a single item that highly valued so I'm not sure how It's Deductible handles those but I'd bet that it asks you the questions and fills out the 8283 accordingly.

There are certain rules about very highly valued items and having to get an appraisal for tax purposes. Again, I never have single items that high so I don't remember the exact threshold.

I do take photos of all my items that I donate. (And I take real photos, not digital because I've heard that in some instances the IRS has a problem with digital. Not sure how true that is - something about the ease of doctoring digital vs. real ones.) I don't know how critical is it to have the photos but it helps me enter the info anyway and keep track of my donations and I have them just in case I'm ever audited.

Hope that helps,
sjfans
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Not sure if you realize this from the way your question is worded but the It's Deductible software does the form 8283 for you. You just print it out at the end of the year and attach to your tax forms.

Well, crap. It used to do form 8283 for you -- I know that's how I did my 2002 and 2003 forms. Either the 2004 version doesn't do it or I'm just not seeing it...

sjfans
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Well, crap. It used to do form 8283 for you -- I know that's how I did my 2002 and 2003 forms. Either the 2004 version doesn't do it or I'm just not seeing it...

It can't possibly generate the 2004 Form 8283 since the Form hasn't been released yet. I would assume that next year's version of It's Deductible will print the form.

Ira
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Greetings, sjfans, thanks for your truly helpful reply. I just downloaded ItsDeductible today and it asked me to make a decision about whether I was donating in 2003 or 2004 (saying that once made, the decision could not be changed). Then it informed me that I need to regularly check for updates, at least once a quarter and when tax season arrives, at least once a month. Perhaps one of those updates late this year will contain the 8283 - boy, I sure hope so! Very much appreciate all responses to my questions.

xraymd
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It can't possibly generate the 2004 Form 8283 since the Form hasn't been released yet. I would assume that next year's version of It's Deductible will print the form.

Hmm . . . I thought the 8283 was one of those "generic" forms. I mean, I'm sitting here looking at a copy (granted I printed it last tax season) and I don't see a date anywhere on it. Or a place to put one other than listing the dates of contributions. It says it was last revised in Oct 1998, that's it.

When you go to the IRS website, you don't get listings for "2003 Form 8283" or "2004 Form 8283." It's just "Form 8283 (Rev. Oct 1998.)"

Besides, I'm using the 2004 version of the software and all info I put into it pertains to the 2004 tax year. Next year's version will be 2005. And I'm sure I printed form 8283 on previous versions of the software long before the tax year was through. I'm one of those people who tries to project what this year's taxes will be from the beginning of the year and update as needed as I go along.

I'm afraid they may have done away with that in this year's version. Or perhaps, as was mentioned, an update later this year will install it? It kind of doesn't look like it though from the way the software is set up (and no mention of it that I can find...)

sfjans
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When you go to the IRS website, you don't get listings for "2003 Form 8283" or "2004 Form 8283." It's just "Form 8283 (Rev. Oct 1998.)"

It may not have been revised since 1998, but that doesn't mean it won't be before the end of this year. Any 2004 tax forms are potentially subject to changes during the year, depending on what our representatives do to tax law this year.
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It's deductable is a great program. Altiile time consuming to enter in the data, but, if you start with good records, it's not too bad.

As far as amount, in 2001 I had $1657 in charitable contributions, 2002 was $4833 and 2003 it was $4625.

That's alot of junk and other stuff I was going to give away to the 2nd hand stores anyways. I might as well get credit.

Also, don't forget about all those girl scout cookies... :)

cat
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cat,

[[Also, don't forget about all those girl scout cookies...]]

When you get something in return from a charitable organization, i.e. Girl Scout cookies, you only get to deduct the amount you paid over the value of the goods received, not the total amount paid.

Choc
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I know, but I give them like $5 for a box that probably costs $1. Also, how much change do you drop in the Salvation Army bucket at xmas?

cat
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state taxes paid (though I think I will now have to enter a figure for any refunds from the state elsewhere on my 1040)

You don't have to enter state tax refunds until you itemize them as a deduction. You said you had been using the standard deduction until now, so you haven't been using state income tax as a deduction. Since it's not deducted, you don't have to add any refund back to income.

Carol
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but I give them like $5 for a box that probably costs $1.

Remember, their cost isn't important. The non-deductible portion is the FMV of the item received. What would a comparable box of cookies cost you in the grocery store? That is the non-deductible portion of a Girl Scout cookie purchase.

--Peter
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Also, don't forget about all those girl scout cookies... :)

Girl Scout Cookies are NOT tax-deductible if you keep/eat the cookies. You have purchased them at fair market value. They are only deductible if you leave the cookies with the troop or give them to a food pantry or similar charity.

Reference: Girl Scout FAQ, http://www.girlscouts.org/faqs/cookies.html#taxdeductible

Ira
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as far as the state taxes go.
You itemize in year one, by putting the state taxes paid on the Schedule A.
In year two, you put any refund you received in year one.

Tammy
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Only Ira would be able to find the answer to girl scout cookie deductibility!

LOL

Tammy
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Only Ira would be able to find the answer to girl scout cookie deductibility!

You're welcome. (I think.)

Ira
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I've yet to fill out the form because I keep all my donated items under the $500 mark. If you periodically give your items away to various charities and libraries through the year it would save some documentation. Works for me !
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I've yet to fill out the form because I keep all my donated items under the $500 mark. If you periodically give your items away to various charities and libraries through the year it would save some documentation. Works for me !

Spreading your non-cash contributions throughout the year and over a number of charities won't help at all. The instructions for Schedule A, Line 16 state that you have to complete Form 8283 if the total of your non-cash contributions exceeds $500, not the amount of a single item or those given at one time or to one charity.

Ira
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Ira is correct -- I was wrong about form 8283. I just checked my tax forms.

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