How Much of a Tax Deduction Do I Get From Donating Furniture?
Donating your old table and chairs can earn you a tax deduction.
chairs & table image by timur1970 from Fotolia.com
Whether you're moving and don't want the hassle and cost of packing and shipping your old furniture or your year-end bonus is allowing you to upgrade, donating your old furniture to charity is a benevolent act and a tax-saving strategy. The furniture must be in "good used condition" or better to be eligible for a deduction when you file your tax return.
Fair Market Value
The general rule for furniture donations is that you can write off the fair market value of the furniture. The Internal Revenue Service doesn't give specific values for figuring fair market value, but rather says it's the price that a willing
seller would offer and a willing buyer would pay. Some charities publish lists estimating prices for furniture based on condition to give you an idea of the fair market value for different pieces of furniture.
Adjustment for Gains
You have to reduce the fair market value of the furniture by any amount that would constitute ordinary income if you had sold it instead of donating it. This includes the price of the furniture above the cost of the materials if you made it or the increase in value over what you paid for it if you've owned it for less than one year. For example, if you get a great deal on a desk and donated it the next day, your deduction is limited to what you paid for it.Source: finance.zacks.com