While QuickBooks is the best way to keep track of money paid out to charities, it doesn’t have the ability to easily track and properly document noncash items donated, such as old clothes and furniture.  There are various ways to assign value of used items donated to charities.

You can use WAGs (wild ass guesses), the most common technique.

You can use one of the various guides, such as this one from the Salvation Army.

A computer program to do this that’s been around for several years is It’s Deductible.  Intuit purchased the company that produces it a number of years ago and now includes it in TurboTax.  A few years back, Intuit said they were going to add It’s Deductible compatibility to Lacerte, another company they bought (and the tax prep program we have been using since 1985); but so far that hasn’t been more than an empty promise.

H&R Block has its own version of the It’s Deductible program, called Deduction Pro, that also includes info on other Schedule A deductions. The website lists the price as $19.99.  For the past year or so, I have been subscribing to the free RSS feed from TechBargains and have learned about several money saving opportunities.  This morning’s feeds included one linking to a free copy of DeductionPro.  I downloaded it and checked out some of the values for noncash items and was impressed with how many it includes. When you install it, you have the option of setting it up for the year 2004 or 2005.

I pass this along for informational purposes.  As always, I must warn that no software, including the extremely expensive Lacerte programs that we use in our offices, can take the place of a knowledgeable and experienced professional tax preparer. Programs like those mentioned here should only be used to help you better organize your information for your personal tax pro.  

- posted by Kerry M. Kerstetter, MBA~CPA~ATP~ATA @ 1/15/2006 02:57:00 PM Send this post: