Why You Need Antique Appraisals for End of Year Charitable Gifts

If you had to guess, how many people would you say donate to nonprofit organizations annually? Would you be surprised to learn that more than 1.4 billion donate globally while 69% of Americans make charitable contributions throughout the year? December is the biggest month for charity contributions, so if you claim tax deductions, here is why you need antique appraisals for end-of-the-year charitable gifts.

Reasons To Get Antique Appraisals on Charitable Gifts Over $5,000

With the holiday season quickly unfolding, lots of generous donors are readying for end-of-year charitable donations and the fast-approaching tax season. Having a reputable, certified appraiser is a must-have when it comes to the U.S. Internal Revenue Service. For charitable contribution deductions, having certified antique appraisals or fine art appraisals is critical to establishing fair market value (FMV).

A few factors that affect an item’s fair market value are its current market cost or purchase price, comparable item valuations, replacement prices, and expert appraisals. Items over time may increase or decrease in value, so you want an expert who is knowledgeable and who is also certified as an appraiser. An experienced appraiser uses these variables along with evidence to determine charitable contribution deductions.

The IRS does not take your word for charitable deductions. The IRS establishes a clear threshold for taxpayers to meet. Here are a few things you should know about the end-of-year charitable giving and taxes.

  • Donating Collections

Collections are wide-ranging, but the IRS identifies charitable donations such as autograph memorabilia, rare books, guns, coins, stamps, artwork, and historical artifacts as examples of interest. While the IRS does support current hobby periodicals or reference materials as proof of an object’s current market value, an appraisal will certify the valuation based on facts rather than auction bidding or market fixing, which is more reliable. You’ll also require a statement of value (SOV). Moreover, if your item is valuable, you should consider an appraisal of utmost importance to certify your donation amount.

  • Donating Gems & Jewelry

Gems and jewelry are typically personalized, so pieces must be appraised to establish value, cut, weight, style, coloring, setting, flaws, and fashion. As an example, two bracelets belonging to Marie Antoinette sold for $8.2 million. With 112 diamonds in three exquisite strands, they were appraised by Christie’s between two and four million. Because of their famous owner, the final sale cost doubled.

  • Donating Clothing & Other Personal Home Goods

If you donate clothing or other personal goods, you can claim a standard IRS deduction of $500. If you itemize pieces valued at over $500, you’ll need an appraisal and form 8283 when you file your taxes.

  • Donating Art, Antiques, & Paintings

If you have art, antiques, or paintings that may have a market value of over $5,000, you’ll need a written appraisal for the IRS to accept the assessment for a charitable contribution deduction. For art valued over $20,000, you must submit a signed appraisal with your tax return. We also advise our clients to secure a digital color image that is 8×10 to keep on file should the IRS require more evidence. For art over $50,000, you’ll need an appraisal as well as a Statement of Value, Form 8283, and a receipt of payment for $7,500 for up to three charitable donations ($400 for each additional art or antique).

Manzi Appraisers & Restorer have been helping taxpayers for more than two decades with charitable gift-giving and assessable deductions. To learn about how we can help you this December, give our office a call at 617-948-2577. You can also follow us on Facebook by visiting us at https://www.facebook.com/ManziAppraisers/ where we can answer questions about our appraisal documents or tax preparation.