When it comes to non-cash contributions, understanding the tax implications can be a bit tricky. If you've made contributions of certain non-cash assets, such as cryptocurrencies and securities, that exceed $500 in value, you'll need to file an IRS 8283 Form with your federal income tax return. This form is used to report information about non-cash charitable contributions when the deduction for all non-cash gifts is more than $500.
Filing your 8283 is a fairly standard procedure in most popular tax filing software. However, if your crypto contributions in any calendar year exceed $5,000, the IRS requires you to obtain a qualified appraisal. If your situation requires a Donee signature, Daffy can assist you with this process. Simply email us at firstname.lastname@example.org.
One of the great benefits of using Daffy as your Donor-Advised Fund (DAF) is that you don't need to worry about capital gains taxes for any assets that you contributed and were sold. However, it's important to note that donations to charities from a DAF do not qualify for a tax deduction.
Whether you've contributed stock or crypto in 2021 that exceeded $500 in value, you'll be required to file an 8283 Form with your federal income tax return. This is a standard form supported by almost all the tax-preparation software providers and is a simple addition for any certified tax professional.
As always, it's best to consult with a certified tax professional to understand your specific situation. The information provided here is for educational purposes only and should not be considered tax advice.
If you're not yet part of the Daffy community, we invite you to get started today. Daffy is the Donor Advised Fund for You™, recognized as a tax-exempt public charity. We're here to make giving a habit and to help you navigate the tax implications of your generous contributions.
Please note that the information contained on this page is for educational purposes only and should not be considered tax advice. Any calculations are intended to be illustrative and do not reflect all of the potential complexities of individual tax returns. To assess your specific tax situation, please consult with a tax professional.