In-kind donations are non-cash charitable gifts — property, goods, securities, or the use of assets given to a qualified nonprofit instead of money. They can be deducted on your federal return, but only if you itemize on Schedule A rather than take the standard deduction, which for 2026 is $16,100 for single filers and $32,200 for married couples filing jointly. Everything else about the deduction depends on what you gave, what it was worth, who received it, and whether you have the paperwork to prove all three.
What Counts as an In-Kind Donation
Non-cash gifts split into two broad categories. Tangible contributions include used clothing, furniture, computer equipment, building materials, medical supplies, and food inventory; businesses often move excess stock this way. Intangible contributions cover assets with no physical form, such as patents, publicly traded securities, and the right to use property like office space or advertising slots.
Personal services do not count. You cannot deduct the value of your time, no matter what you would charge on the open market. An attorney who provides 40 hours of pro bono work to a 501(c)(3) gets no deduction for the hourly value of that work, because the statute authorizes deductions for payments of money or property and services fit neither. What you can deduct are unreimbursed out-of-pocket costs you incur while volunteering, including supplies purchased for the organization and mileage driven on its behalf at the statutory rate of 14 cents per mile.
Which Organizations Qualify
Only “qualified organizations” can receive tax-deductible in-kind gifts:
- Religious organizations such as churches, synagogues, mosques, and temples
- 501(c)(3) charitable, educational, scientific, and literary nonprofits, including groups like the American Red Cross and the United Way
- Federal, state, local, and tribal governments, but only for contributions used for public purposes
- War veterans’ groups and federally chartered veteran service organizations
- Nonprofit hospitals and medical research organizations
Gifts to individuals, political campaigns, and most foreign organizations are not deductible. Before donating, you can verify eligibility using the IRS Tax Exempt Organization Search database.
How to Value What You Give
Every in-kind deduction turns on fair market value: the price a willing buyer would pay a willing seller when neither is under pressure and both have reasonable knowledge of the facts. Applying that definition depends heavily on what the property is.
Household Items and Clothing
Clothing and household goods must be in good used condition or better to qualify for any deduction. The IRS enforces this to keep worn-out items with no real resale value off returns. One narrow exception: if you claim more than $500 for a single item that isn’t in good used condition, the deduction still stands if you get a qualified appraisal and file it with the return. For everyday items in usable shape, thrift-store pricing guides and resale-site comparisons are the standard approach.
Publicly Traded Stock
Donating appreciated stock is one of the most tax-efficient ways to give in kind, and the valuation method is precise. Fair market value is the average of the highest and lowest selling prices on the date of the contribution. If a share traded between $40 and $44 the day you donated it, the per-share FMV is $42. When you donate stock held longer than one year, you deduct the full FMV and avoid paying capital gains tax on the appreciation, which is why donors with large unrealized gains often use this strategy.
Capital Gain Property vs. Ordinary Income Property
The type of property changes how much you can deduct. Capital gain property — assets like stock or real estate held longer than one year that would produce a long-term capital gain if sold — is generally deductible at full fair market value. Ordinary income property, which includes inventory, artwork you created yourself, or anything held one year or less, is deductible only up to your cost basis. For business owners donating inventory, that usually means the deduction reflects what the goods cost, not what they would sell for.
Documentation That Scales With the Gift
The paperwork the IRS requires grows with the value of the donation. Miss a step and the deduction gets denied, even when the gift itself was legitimate.
Written Acknowledgment at $250 or More
For any single contribution worth $250 or more, you need a contemporaneous written acknowledgment from the charity. It must describe the property, state the date of the contribution, and say whether the organization provided any goods or services in return. If you received something back, such as a dinner, event tickets, or merchandise, the acknowledgment must include a good-faith estimate of that benefit’s value. You must have this document in hand before you file. Reconstructing it during an audit is too late.
Form 8283 Over $500
When the total value of your non-cash donations for the year exceeds $500, Form 8283 goes with your return. Section A covers items or groups of similar items valued at $5,000 or less and requires a description of each property, the date contributed, how you acquired it, your cost basis, and the claimed fair market value. Attach it as a PDF when e-filing, or mail it with Form 8453 for paper returns. Failing to attach it is grounds for the IRS to disallow the deduction entirely.
Qualified Appraisal Over $5,000
When a single item or a group of similar items exceeds $5,000 in claimed value, you complete Section B of Form 8283 and obtain a qualified appraisal from a qualified appraiser. The appraisal must comply with the Uniform Standards of Professional Appraisal Practice and meet Treasury Regulation Section 1.170A-17. The appraiser signs and dates the report no earlier than 60 days before the donation date, and an authorized official at the receiving charity signs Part V of Form 8283 acknowledging receipt. Publicly traded securities are exempt from the appraisal requirement because their value is set by market prices.
This is where large deductions fail most often. Donors skip the appraisal, get it done too early, or hire someone who doesn’t meet the IRS qualification standards. Certified appraisers of tangible personal property typically charge in the range of $25 to $40 per hour, a modest cost against a five-figure deduction.
Vehicles, Boats, and Airplanes
Donated cars, boats, and aircraft follow their own rules because charities usually sell these items rather than use them. When the charity sells your vehicle, your deduction is limited to the gross proceeds of the sale, not the blue-book value. The charity must send you Form 1098-C within 30 days of the sale, reporting the price it received.
Two exceptions allow a deduction at full fair market value: the charity uses or materially improves the vehicle before disposing of it, or the charity gives or sells it at a below-market price to a person in need. When the charity sells for $500 or less and neither exception applies, the deduction is capped at the lesser of $500 or the vehicle’s FMV on the donation date.
AGI Caps and Carryforward
Even with perfect documentation, your deduction may be limited by your adjusted gross income. The caps depend on both the property type and the organization type:
- Cash to most public charities: up to 60% of AGI
- Capital gain property to most public charities: up to 30% of AGI, though you can elect the 50% limit if you reduce the deduction to your cost basis instead of FMV
- Contributions to private foundations and certain veterans’ or fraternal organizations: up to 30% of AGI
- Capital gain property to private foundations: up to 20% of AGI
Amounts above these limits are not lost. They carry forward for up to five additional tax years, subject to the same percentage limits each year. Running the AGI math before a large in-kind gift prevents surprises at filing time.
What Isn’t Deductible
Some gifts look charitable but produce no deduction. Contributions to political organizations or candidates never qualify. Neither do gifts to individuals, even someone in genuine financial distress. Donations to foreign organizations generally don’t qualify unless a specific U.S. treaty provision applies.
Quid pro quo contributions get partial treatment. If you pay more than $75 to a charity and receive goods or services back, the charity must provide a written disclosure estimating the value of what you received. Your deduction is limited to the amount that exceeds the benefit. A $200 gift to a gala with a $60 dinner produces a deductible amount of $140.
Penalties for Overstating Value
The IRS treats inflated valuations seriously. Overstate the value of donated property by 150% or more of its correct value, and if the resulting tax underpayment exceeds $5,000, you face a 20% accuracy-related penalty on the underpayment. If the overstatement reaches 400% or more, the penalty doubles to 40%.
These penalties come on top of the additional tax owed once the deduction is corrected. A donor who claims $20,000 for property actually worth $5,000 has a 400% overstatement, a gross valuation misstatement, and faces the 40% penalty on the full resulting underpayment. Large non-cash deductions are a routine focus of IRS review, and inflated-looking appraisals are among the more common audit triggers on individual returns.
Records to Keep
Hold every document tied to an in-kind donation for at least three years from the date you filed the return claiming the deduction, or two years from when you paid the tax, whichever is later. That means written acknowledgments from the charity, appraisal reports, copies of Form 8283, photographs of donated items, and records of your original cost basis. For high-value gifts, keeping records longer is prudent, because the IRS has a six-year statute of limitations when income is substantially understated.