Good record-keeping vital when claiming deductions for donations

There are many things individuals are allowed to claim deductions for on their federal taxes. One of the things that quite a few taxpayers claim deductions in connection to are donations to charitable organizations.

Now, there are a plethora of rules regarding charitable giving deductions. Among these are the documentation rules related to such deductions. When a taxpayer claims a deduction for a charitable donation and doesn’t have the right documentation for the donation, it could create real problems for them. For example, it could put them in a tough situation in the event of an audit.

Thus, when one is going to claim charitable giving deductions on their taxes, it is very important for them to have everything in order when it comes to documentation. This includes being sure that, prior to filing a return claiming deductions for donations, they have all the appropriate acknowledgements of the donations. This is important for both monetary donations and non-cash donations.

This underscores the importance of good-record keeping when it comes to taxes. Keeping accurate and complete tax-related records can be very helpful for a taxpayer if they get audited, as it may be able to help the audit process go more smoothly. Another thing that can be helpful for a taxpayer when facing an audit is having an experienced tax attorney’s representation during the audit. Lawyers skilled in tax audit matters can help steer taxpayers away from mistakes or oversights that could create unnecessary problems or complications during the audit process.

Source: MarketWatch, “Tricky issues taxpayers should keep in mind this year,” Tom Herman, Feb. 10, 2016