Treat Yourself to a Tax Deduction this Halloween

October 31, 2012 — Leave a comment

On behalf of everyone here at JDKatz, P.C., we wish you a safe and happy Halloween!
We’d also like to remind you NOT to throw-out your used costumes and extra candy tomorrow.  Instead, consider donating them to a qualifying tax-emempt charity.  Here’s how:
Costumes
What may have been a goofy halloween costume for you could mean clothing, fabric or next year’s halloween costume for someone else.  Costumes are considered non-capital gain property, and can be donated and itemized.  As long as your donations do not exceed 50% of your income, your deductions should be honored provided you have proper documentation including a receipt from the organization, or if you’re donating to a charity drive – pictures proving the materials were in good condition.  Photo documentation is always a good idea, as it may prove valuable in determining and proving the fair market value of your deductions.  Goodwill is one such non-profit that accepts used costumes and qualifies as a 50% tax-exempt organization.
Candy
Yup. Unused, wrapped commercial candy can be donated too.  Many organizations accept candy and send it to US troops as part of care packages for soldiers.  Find a step-by-step guide on how to donate leftover candy here.

Be sure to check out the IRS list of organizations before claiming your donations as tax deductible.

For more on Halloween and your personal finances, check out this infographic on DIY costume making:

JDKatz, P.C. is a full-service law firm focused on tax law and estate planning. We are dedicated to minimizing your existing liability and risks while providing valuable tax planning to streamline your tax issues in the future. Please call us at 301-913-2948 to schedule an appointment to meet with one of our trusted attorneys.

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