Take Care In Valuing
Your Donations
Determining the value of the goods you are giving
away may be one of the most difficult aspects of
determining what your deductions might be. Unfortunately,
there aren't any cast-in-concrete formulas to give
you the "right" answer. The determination
of the value is really left totally up to you.
Here are a few general guidelines that may help
you:
• The condition of your donation is important.
Compare the style of your donation with current
styles. Outdated and/or damaged property may
have little or no market value. Categorize each
item you are giving by its condition (e.g., poor,
good, excellent, new, etc.)
• What would the item you are donating
sell for in the current market? A visit to the
local thrift shop, a quick glance through newspaper
classified ads, or o stop of a neighborhood garage
sale should provide you with a pretty good idea
of the prices of goods like yours.
• If your donation includes a vehicle,
equipment, or machinery, you could consult with
publications of commercial firms or trade organizations
to find out your property's value. Many of these
organizations regularly publish information about
going sales prices for cars, boots, airplanes,
etc. Classified ads or results of area auctions
may also be of use in determining a valuation.
Your research will probably show that most used
merchandise has a value that is considerably less
than your property's original cost!
However, some items you give away may have actually
gone up in value (e.g., antiques, jewelry, or artwork).
To determine the value of these you will want to
hire a qualified appraiser.
