Reader Questions: Food Donations/Tax Deduction Recordkeeping

Reader Pati has a great question on how to keep track of food donations for tax purposes.


Since it’s tax time I am just wondering if any of your readers had any good advice on a way to keep track of donations made to food banks and pantries for tax deduction purposes.

What kind of tips do you guys have for Pati.  I’m interesting myself.

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  • D

    me, too….any accountants out there with advice? do we need receipts from the non-profit?

  • Melissa O.

    Turbo Tax has a great software called “It’s Deductible.” I save all my receipts and when I make a donation purchase, I log onto the program and write down what I put in my donation box. You can modify the donation date and time. It’s free to use.

    If you are itemizing your tax deductions (we always do), your list from It’s Deductible will transfer onto the appropriate tax forms. If you have your accountant do it, you can just print out the list and give it to him. Keep your receipts as backup.

  • Kathleen

    I don’t bother. Most of the stuff I donate is free or close-to-free.

  • lisa

    yes, kathleen but i believe you can donate the original retail cost minus coupons. check with your accountant

  • Stacey

    This aspect of giving is of great concern to my husband and myself. I keep detail records of the what I give. The details include the original price, quantity, coupon value used, discounts received and out of pocket amount. It’s important because we have a financial goal in giving for each year.

    We give this sheet to our accountant every year. We give approx. $4,000 worth of food a year, so it’s important for us to have this detailed properly. I store the receipts in ziploc baggies per month, with the items given away circled.

    So, I want the $4,000 deduction. We spend roughly 20 – 30% of that through couponing as our out of pocket.

  • Kelly

    I am like Kathleen. I don’t keep track. I try to apply this verse from the Bible
    “But when you give to the needy, do not let your left hand know what your right hand is doing “

    • Obviously you think using tax deductions for charity is morally wrong boy, do you have alot to learn about where your taxes are spent. I have no problem deducting every penny I can!

  • andy

    Have itemized receipts: instead of “2 bags of food” write: 10 cereal, 20 cake mix, etc. etc. Then transfer it immediately on fillable form 8283 downloadable from irs web site. You don’t need an accountant or any software to do this. Keep receipts with filled out forms in an envelope until next year. It won’t allow you to e-file with more than 4 (?) of those forms, so you’ll have to print out and mail paper return anyway. But if you have those forms already printed out you get a great head start – don’t need to re-enter them all again into software.

  • Kelly

    When I am making my holiday baskets (Easter, Thanksgiving & Christmas) for our church’s St. Vincent de Paul Society, I make a conscious effort to get receipts for everything, even if it means seperating my food at the grocery store into two orders, one for the basket, and the other for our household items. This way, I just need to take that one receipt and put it into my tax file.

    We don’t take a tax deduction for stuff that we just pull out of our pantry during the year. Its just not worth the hassle for a 30 cent deduction.

  • Jen W

    As an accountant, I can tell you that:
    – you can only deduct the actual cost out of pocket
    – you need to keep all of your receipts with the items circled
    – you can combine like charities into 1 line item for the whole year to avoid having to mail in your return
    – you can deduct the miles drive to drop off the items. Since you are probably shopping for yourself when you go to the store, you can’t deduct those miles. If you make a special trip for charitable donations, make sure to record the beginning and ending odometer reading, they don’t want to know “x miles” but the actual readings.

    Since the IRS can audit (request backup) for 3 years (they can go back to 2007 until 4/18/2011), my suggestion to my clients and to you would be to scan your receipts in a document and label it “Shoprite 4-2-11” that way you don’t have to worry about the ink rubbing off and you don’t have 3 years worth of clutter-ful (yes I made it up!) receipts hanging around!

    Hope this helps!

    • D

      thanks for that detailed response! 🙂 Question: so does that mean if we use coupons on an item, you can only deduct the actual price paid? ie: Toothpaste for $3.99. Use $1 MFR + $3 ECB’s (or +ups) then you can’t deduct anything?
      And do you need a receipt from the charity? I know when I donate household stuff to goodwill, etc. they just give me a blank ‘receipt’ with the date…
      Just want to make sure! Have no desire to get audited, and if I do want to have my ducks in a row… 😉

      • Jen W

        In your example you would deduct only the $1 Mfr coupon and take credit for 2.99. The ECB is on your next order. If you can get a receipt from the charity, great, if not (my parents take stuff to church who then takes it to the food pantry) having the backup is good enough. The IRS is not really as “bad” as people think it is. They are reasonable if you can show that you are not taking advantage of charitable donations. You could take a picture of the stuff you are donating as well to put with the receipt.

  • Donna

    I take digital photos of each lot of food/household/personal care items that I donate (spread out on a table). I print the photo on the back of the letter I request from the organizations I donate to. Any non-profit charity will supply you with such a letter or receipt, which you need in order to take a deduction.

  • Cassie

    My accountant said to consider it like a clothing donation to goodwill- no store receipts necessary, but that I have to get a signed “receipt” from the charity and list what the items are. He suggested taking a photo to back it up. He also said I can only deduct out of pocket expenses- so if it is free after coupons, it is free, and I cannot deduct it. Since my accountant does not know the nuances of coupling, my interpretation of this is that if I pay $4.56 “out of pocket” but then get a catalina good off my next purchase, I can deduct the whole $4.56. But if I get a rebate back, I cannot, because that is directly reimbursing me for that specific item, not generically off a future purchase. I haven’t decided what ECBs count as- in my state, they function as coupons ( we don’t pay sales tax on pre- coupon prices, and when ECBs come off, sales tax is deducted), but since you can use any number of them, regardless of how many items you buy ( unlike the walgreens program), they also function like gift cards.

    • Cassie

      Whoops, that was supposed to be the “nuances of couponing”. These smart phones are too smart for their own good sometimes. 🙂

  • Pati

    Thank you all for your great comments and suggestions. I will have to weigh the benefits of the tax deductions to the time it would take to keep it all organized (not one of my better traits). While I sometimes agree with those who say it’s not worth the effort I do feel that in the end it all adds up. If you take your donations to food pantries, toys for tots, scouts, schools, etc, etc in the end it totals quite a bit. Again thank you all for your advice and comments.

  • Minddy78

    Thanks so much for this info. I’ve been looking all over for the answer to this question.

  • Amanda

    There is an incremental tax deduction for food items based on the value and the actual cost of the item (this is the cost without considering coupons). Ask your accountant or bookkeeper for the formula but you still need to keep receipts.

    Remember, coupons are legal tender (hence their listed cash value) so paying for items with them is irrelevant for tax purposes. In such case, you can frequently get a tax deduction for items you did not have any out-of-pocket cost for. I currently have a tax-deduction of over $600 and a negative cost (I was paid to buy them with coupons when you consider Catalinas and other circumstances). Talk about a great deduction!