Tax Deduction for a Donated Cell Phone

by Mike Parker

If you buy a new cell phone today, chances are there will be a newer model of that phone next year. Consumers who are looking for the latest technology might be eager to upgrade, but that leaves a huge number of older model cell phones collecting dust in dresser drawers, or worse taking up space in landfills. You can help your community, reduce environmental waste and get a tax deduction by donating your old cell phone.

Qualifying Organization

Giving your old cell phone to a needy individual is a worthy endeavor. It might help that person and give you a warm, fuzzy feeling, but it doesn't qualify for a tax deduction. If you want to take a write-off for donating your cell phone, you must make the donation to a qualifying organization. Organizations that can accept tax-deductible contributions include religious organizations, educational organizations, government organizations, certain war veterans organizations and fraternal societies, amateur athletic associations, scientific, literary or charitable organizations and societies for the prevention of cruelty to animals or children. When in doubt, check with the IRS's online Select Check tool at irs.gov.

Deductible Amount

Cell phones depreciate in value rapidly, especially after a new model of the same phone comes out. When you donate your old cell phone, you can't deduct the retail price you paid for the phone. You can only deduct the phone's current fair market value. The charitable organization you donate to might provide some guidance on how much the phone is worth, or it might leave the amount of the donation up to you. The IRS considers fair market value to be the price a willing buyer would pay for the cell phone in its current condition. You can check the going rate for similar cell phones listed on online auction sites to get an idea of what they are selling for.

Documentation

You should keep records of all non-cash donations, detailing the name of the organization, the date and locate of the donation and the value of your donated cell phone. But if the fair market value of your donated cell phone is less than $250, you don't have to get a receipt if it is not practical to do so. For example, if you donate your old phone through an unmanned drop box at a donation center. If the value is $250 or more you must get a written acknowledgement from the charity.

Itemized Deductions

If you want to take a tax write-off for your donated cell phone, you'll have to itemize your deductions on Schedule A of Form 1040. Add the amount of your cell phone donation to your other non-cash charitable contributions and report the total on Line 17. If your total non-cash contributions exceed $500 you'll also need to attach Form 8283. If the total amount of your itemized deductions is less than your standard deduction, you'll get a lower tax obligation by choosing the standard deduction.

About the Author

Mike Parker is a full-time writer, publisher and independent businessman. His background includes a career as an investments broker with such NYSE member firms as Edward Jones & Company, AG Edwards & Sons and Dean Witter. He helped launch DiscoverCard as one of the company's first merchant sales reps.

Photo Credits

  • Jupiterimages/Photos.com/Getty Images