Charitable giving: the $250 receipt rule, noncash donations, mileage

Two rules changed for 2026. People who take the standard deduction can now deduct cash gifts on top of it, up to $1,000, or $2,000 on a joint return. People who itemize lose the first 0.5% of adjusted gross income in gifts; with an AGI of $100,000, the first $500 given during the year is simply not deductible. Neither rule changes what has always decided whether a gift counts: where it went, and what you can show for it.

What counts as a charity

A deductible gift goes to an organization the IRS recognizes as tax-exempt: a church, a school, a hospital, a food bank, the Red Cross. The IRS keeps a searchable list, and a name missing from it is a warning. Money given to a person, however deserving, is not a charitable gift. Neither is a crowdfunding page set up for a neighbor’s medical bills, a raffle ticket, political giving, or the part of a gala ticket that paid for dinner. If you got something back, only the amount above what you got is a gift, and the charity must tell you the value when you pay more than $75 and receive something.

The receipt rule

Every gift needs a record: a bank or credit card statement, a canceled check, or a receipt from the charity. Cash in the collection plate with nothing to show for it is not deductible, however real it was. The rule is not about honesty; it is about proof, and the IRS and the Tax Court disallow gifts every year that people really made, simply because the records were not right.

Any single gift of $250 or more needs more than a bank record. It needs a written acknowledgment from the charity that states the amount and whether you received anything in return. You must have it in hand by the time you file. A letter obtained after the return goes in does not cure a missing one, so the year-end statement from the church belongs in the tax folder, not the recycling. Each paycheck deduction in payroll giving counts as a separate gift for the $250 rule.

Donated goods

Clothing, furniture, and other household goods given to a thrift store are deductible at their value, not at what you paid, and only if in good used condition or better. Once noncash gifts for the year pass $500 in total, the return needs Form 8283, which lists what was given, to whom, when, and what you paid for it. Any single item or group of similar items worth more than $5,000 needs a qualified appraisal, and the appraiser signs the form; publicly traded stock is the exception. A bag of clothes does not need an appraisal; a piano or a car might. For a car, boat or plane over $500, the charity sends Form 1098-C, and if the charity sells it your deduction is usually the sale price, not the book value.

Mileage

Driving for a charity, such as delivering meals or taking a scout troop to camp, is deductible at 14 cents a mile, or actual gas and oil, plus parking and tolls. Keep a log with dates, miles and purpose. The rate is set by law and has not changed since 1998, so it is small, but it adds up for a regular volunteer. Your time is not deductible, however valuable; supplies you buy for the charity’s work and uniforms not suitable for everyday wear are.

The better ways to give

Appreciated stock. Giving shares held more than a year deducts the full value and skips the capital gains tax on the growth. Someone who bought shares for $2,000 that are now worth $10,000 can give the shares, deduct $10,000, and never pay tax on the $8,000 gain; selling first and giving the cash would have taxed the gain at 15% plus Colorado’s 4.40%, about $1,550. Do not give stock that has lost value: sell it, take the loss, and give the cash.

A qualified charitable distribution, after 70½. A gift sent directly from an IRA to the charity, up to $111,000 in 2026, never enters your income at all, which helps with Social Security taxation and Medicare premiums in a way an ordinary deduction cannot, and it counts toward the required minimum distribution. For a retiree who takes the standard deduction, it is usually the only way a gift saves any real tax. It cannot go to a donor-advised fund.

Bunching. Give two or three years’ worth in one year and itemize, then take the standard deduction in the off years. You pay the 0.5% floor once instead of every year, and the standard deduction in the off years is a free gift from the tax code. A donor-advised fund lets you take the deduction in the bunching year and hand out the money to charities over time; appreciated stock works especially well in one.

Small, steady givers who take the standard deduction should make their gifts in cash or by check directly to the charity, not through a donor-advised fund, so they count toward the $1,000 / $2,000 line.