Donation Values for Tax Purposes: Appraisals, Form 8283, and Limits

Donation values for tax purposes are set at fair market value: the price a willing buyer would pay a willing seller for the item in its current condition, with both sides having reasonable knowledge of the facts and neither under pressure to close the deal.¹ The IRS does not publish a price list. You have to approximate what your specific item would fetch today, document how you got there, and follow escalating paperwork rules as the number climbs.

Pricing Clothing, Furniture, and Household Goods

For everyday donations, look at what comparable used items actually sell for at thrift stores, consignment shops, and online resale platforms. Retail price is not the answer. A winter coat that cost $200 new but would sell for $30 at a resale shop in its current state is worth $30 for deduction purposes, not $200. Completed sales are stronger evidence than asking prices, so a listing that closed at a specific number beats one still sitting on the market.

Clothing and household items, which the IRS treats as including furniture, electronics, appliances, and linens, must be in good used condition or better to qualify at all.¹ Stained shirts, broken appliances, and worn-out couches do not clear the bar. There is no precise IRS definition of “good used condition,” but a workable test is whether a thrift store would accept the item and put it on the sales floor.

One narrow exception: you can deduct an item below good used condition if it is worth more than $500 and you attach a qualified appraisal to your return.² Few individual garments or household pieces reach that threshold, so this mostly matters for unusual property like damaged vintage textiles.

Higher-Value Items and Appreciated Property

For jewelry, antiques, art, and collectibles, pricing rests on recent sales of comparable items. Auction records, dealer catalogs, and sales data from recognized marketplaces carry the most weight. Match the comparison as closely as you can on age, quality, and condition. A rough match invites the IRS to substitute its own number.

If you donate property that has gone up in value since you bought it, such as stock or real estate held long-term, you can generally deduct its full fair market value on the date of the gift rather than what you originally paid.³ You also avoid the capital gains tax you would have owed on a sale. The trade-off is a tighter AGI cap, covered further down.

Vehicle Donations Follow Their Own Rules

Cars, boats, and airplanes are the biggest exception to fair market value pricing. If the charity sells the vehicle, your deduction is capped at the gross sale proceeds, not the vehicle’s market value.⁴ A car with a Kelley Blue Book value of $5,000 that the charity auctions for $1,800 produces an $1,800 deduction.

You can claim full fair market value only if the charity puts the vehicle to significant use, materially improves it before sale, or transfers it to a person in need at a price well below market.⁵ The charity must send Form 1098-C within 30 days of the sale or transfer, and you have to attach it to your return whenever your claimed deduction is over $500. No 1098-C, no deduction.

Subtract Anything You Got Back

When a donation comes with something in return, like a gala dinner, concert tickets, or merchandise, only the amount above the fair market value of what you received is deductible.⁶ Pay $200 for a charity dinner where the meal is worth $75, and your deduction is $125.

Charities that take in more than $75 in a quid pro quo payment are required to send you a written breakdown showing how much of the payment was deductible.⁶ If it does not arrive, ask. Deducting the full payment when you received something in return is one of the most common audit flags in this area.

Documentation Scales With the Dollar Amount

Whatever number you land on, the IRS wants proof. The paperwork requirements ratchet up at three thresholds.

$250 or More: Written Acknowledgment

Any single non-cash contribution worth $250 or more requires a written acknowledgment from the charity before you file.⁷ The letter has to describe the property and state whether you received anything in exchange. The charity does not assign a value; that is your job. Missing this letter kills the deduction if you are audited.

Over $500 Total: Form 8283

Once your combined non-cash deductions pass $500, Form 8283 goes in with your return.⁸ Section A covers items or groups of similar items valued between $500 and $5,000, plus publicly traded securities regardless of value. For each entry, you list a description, the acquisition date, your cost basis, and the fair market value you are claiming.²

Over $5,000: Qualified Appraisal

When your claimed deduction for a single item or group of similar items exceeds $5,000, you generally need a qualified appraisal, and the details go in Section B of Form 8283.¹ The appraiser must hold a designation from a recognized professional organization and have experience valuing that type of property. A real estate appraiser cannot appraise your art collection. The appraisal has to be dated no earlier than 60 days before the donation and no later than the return’s due date, and the appraiser signs Section B directly.

Some property is exempt from the appraisal requirement even above $5,000:

Publicly traded securities, because market quotes establish value.
Vehicles where the deduction is limited to the charity’s sale proceeds, since Form 1098-C replaces the appraisal.
Non-publicly traded stock valued at $10,000 or less, which stays in Section A.¹

Regardless of the threshold, keep your own records: donation date, how you acquired the item, what you paid, and the method you used to price it. Photographs help for higher-value pieces. Hold everything for at least three years after filing.

How Much of Your Valuation Actually Deducts

The number you assign is not necessarily the number that flows through to your tax bill. Two limits sit on top.

Starting in 2026, only the portion of your charitable contributions that exceeds 0.5% of your adjusted gross income is deductible, under the One Big Beautiful Bill Act. At $100,000 of AGI, the first $500 of giving produces no deduction. Above that floor, an annual AGI cap applies based on what you gave and to whom:⁴

60% of AGI for cash gifts to public charities, including churches, schools, hospitals, and donor-advised funds.
30% of AGI for appreciated property given to public charities, or cash given to private foundations.
20% of AGI for appreciated property given to private foundations.

Contributions over the cap carry forward for up to five tax years before they expire.⁹

Penalties for Inflated Values

Overstating what a donation is worth carries accuracy-related penalties that scale with how far off the number is:⁴

20% of the resulting tax underpayment when the claimed value is 150% or more of the correct amount and the underpayment exceeds $5,000.
40% when the claimed value is 200% or more of the correct amount and the underpayment exceeds $5,000.
50% for overstatements of certain qualified charitable contribution deductions under a provision added by the One Big Beautiful Bill Act.¹⁰

The percentage applies to the tax you underpaid, not to the donation itself. A defensible valuation, supported by comparable sales for modest items and a qualified appraisal for the significant ones, is the practical protection. The IRS is far less likely to push back on a number backed by proper methodology and credentials.

1
Internal Revenue Service. Publication 561 – Determining the Value of Donated Property
2
Internal Revenue Service. Instructions for Form 8283 – Noncash Charitable Contributions
3
Internal Revenue Service. Charitable Contribution Deductions
4
Internal Revenue Service. Publication 526 – Charitable Contributions
5
Internal Revenue Service. Form 1098-C – Contributions of Motor Vehicles, Boats, and Airplanes
6
Internal Revenue Service. Life Cycle of a Private Foundation – Quid Pro Quo Contributions
7
Internal Revenue Service. Charitable Contributions – Written Acknowledgments
8
Internal Revenue Service. About Form 8283, Noncash Charitable Contributions
9
Office of the Law Revision Counsel. 26 USC 170 – Charitable, Etc., Contributions and Gifts
10
Office of the Law Revision Counsel. 26 US Code 6662 – Imposition of Accuracy-Related Penalty