Donated Household Goods over $5000

[HaroldinGeorgia]

New Client this year. Her Mother passed away in 2012 (my long-time client). She inherited everything. Gave all the household goods to 2 charities in 2013; 11 different dates. She has compiled a list of everything and used TurboTax evaluation guide; Total for the year comes to $20,000.

Since it was inherited I am using mother's date of death as date acquired; adjusted basis as fair market value, since there could be a penalty for overstating basis.

Pub 526 and Pub 561 indicate an appraisal is required for anything over $5000. Is IRS likely to consider the total for the year as over $5000, rather than any one date? Too late for an appraisal now, so if so she will be limited to under $5000??

Anyone have thoughts or advice on this? New situation for me.

Harold

[Terry D EA]

I ran across this earlier this year and wondered the same thing, After telling the client he needed an appraisal he decided to reduce the amounts to just under 5000.00. Was he inflating it to begin with? Hmmmm.

[HaroldinGeorgia]

Thanks Terry. I don't think this lady was trying to inflate, but just didn't know. Anyway, she is really going to be

disappointed in losing $15000 in deductions.

Thanks for your response.

Harold

[Jack from Ohio]

If the donation total is over $5,000 per year, there MUST be a 3rd party appraisal. Simple as that. She should have asked you first.

Probably would have benefited the charity more if she had sold the items and gave them the money.

[michaelmars]

If the donation total is over $5,000 per year, there MUST be a 3rd party appraisal. Simple as that. She should have asked you first.

Probably would have benefited the charity more if she had sold the items and gave them the money.

the rule is only for over 5000 in similar items so if in this case it was 4999 in furniture, 4999 in clothes 4999 paintings, etc you avoid the issue.

I have never filed with appraisals when each individual contribution was under the 5000. maybe I was lucky or maybe its just something they don't look at. the instructions for the 8283 give general description of items that do break up household items.

[kcjenkins]

Yes, you can break it into groups, and if she used a gift guide, you are probably on good ground on the valuations. Maybe she loses a little, but not 15,000.

[jshtax]

Do multiple donations each under $5000. 5 $4000 donations is $20,000