Sole Proprietorship A sole proprietor is a business owned by a person. This person will file his or her business taxes using Schedule C while filing form 1040. For a charitable contribution, it will not be filed on the person’s Schedule C it will be taken as a deduction on his or her personal taxes. The taxpayer would file a Schedule A. However, the caveat for this would be if the individual does not have enough deductions to itemize and must take the standard deduction. Then the person would not be able to claim the charitable contribution. For a cash or non-cash contribution (i.e. computer, unsold inventory, etc) the tax payer needs a receipt. For any non-cash contribution over $500 the individual must also file a form 8283. Any type of service such as volunteering is not deductible however the gas getting to and from the location is deductible. For non-cash contributions of expensive items proper and detailed documentation is needed. The tax payer needs to be able to prove it. However regardless of how much is donated a taxpayer cannot take more than 50% of his or her adjusted gross income. There are many other limitations that can be found in IRS Publication 526.
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A closely held C Corporation and all C Corporations can donate to a charitable organization no more than 10% of its taxable income. For a closely held C Corporation that donates a computer said to be worth $725 a form 8283 must be filled out. A regular C Corporation does not need to report the 8283 form but still needs to supply details of the non-cash donation just a little less
A closely held C Corporation and all C Corporations can donate to a charitable organization no more than 10% of its taxable income. For a closely held C Corporation that donates a computer said to be worth $725 a form 8283 must be filled out. A regular C Corporation does not need to report the 8283 form but still needs to supply details of the non-cash donation just a little less