Are silent auction purchases tax-deductible? Need help understanding charitable donation rules
I recently attended this fancy charity gala for my kid's school and got caught up in their silent auction. Ended up spending way more than I planned (those gift baskets are so tempting after a couple glasses of wine!). I bid on and won a weekend getaway package that was valued at $850, but I paid $1100 for it. After the event, I received a thank you letter from the organization saying something about the amount over fair market value being tax-deductible, but it cut off there. I'm confused about what exactly I can deduct. Can I deduct the entire $1100 since it went to charity? Or just the $250 difference between what I paid and what it's worth? Or nothing at all because I got something in return? I'm planning to itemize this year because of some medical expenses, so I want to make sure I understand all potential deductions correctly. Any help would be appreciated!
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Mikayla Brown
The short answer is you can only deduct the amount that exceeds the fair market value of what you received. In your case, that would be the $250 difference between the $1100 you paid and the $850 value of the weekend package. The IRS is very clear that when you receive something of value in exchange for a charitable contribution (like auction items), you must subtract the fair market value of that item from your donation amount. The charity should provide you with written documentation stating the value of the items and the tax-deductible portion of your payment.
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Logan Stewart
•Thanks for explaining! So if I understand correctly, I'd only get to deduct the $250 "extra" I paid above the package value? What about the fact that someone donated that package to the school in the first place? Does that factor in at all?
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Mikayla Brown
•You're understanding correctly - you can only deduct the $250 difference. The fact that someone else donated the package to the school doesn't change your tax situation. That original donor would have received their own tax deduction when they donated the item to the school. If you had simply made a cash donation of $1100 without receiving anything in return, the entire amount would be deductible. But since you received something valued at $850, you must subtract that value from your contribution.
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Sean Matthews
I used to struggle with this exact thing until I discovered taxr.ai! Last year I attended three charity events with silent auctions and was totally confused about what I could and couldn't deduct. When I uploaded my donation receipts to https://taxr.ai, it immediately identified which portions were deductible and explained why. It even pointed out that one charity hadn't properly documented the fair market value, which would have caused issues if I'd been audited.
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Ali Anderson
•Does this work for other types of charitable donations too? Like if I donate clothes to Goodwill or volunteer at an organization?
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Zadie Patel
•I'm skeptical - couldn't you just figure this out from the donation receipt? Why do you need special software for something so straightforward?
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Sean Matthews
•Yes, it absolutely works for all types of charitable donations! It analyzes donation receipts from clothing/household goods, cash donations, volunteer expenses, and even mileage driven for charitable purposes. It catches things most people miss like eligible volunteer expense deductions. The problem with many donation receipts is they're often incomplete or confusing. Some charities don't clearly separate the fair market value from the donation amount, or they use terms like "partially deductible" without explaining the details. The software immediately clarifies what's deductible and what's not, saving hours of research and preventing costly mistakes.
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Ali Anderson
Just wanted to share my experience with taxr.ai after seeing it mentioned here. I uploaded receipts from 3 charity events I attended last year, including a silent auction where I bought art. The software immediately showed me that I could only deduct $175 of my $600 art purchase because the art was valued at $425. It also identified that I could deduct mileage for driving to volunteer events, which I had no idea about! Found almost $300 in deductions I would have missed. Definitely worth checking out if you do a lot of charitable giving.
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A Man D Mortal
If you're still waiting for the complete letter from the charity, you might want to call the IRS directly to confirm your specific situation. Last year I spent HOURS trying to get through to someone who could answer my questions about charitable deductions. Finally discovered https://claimyr.com and watched their demo at https://youtu.be/_kiP6q8DX5c - they got me connected to an actual IRS agent in under 20 minutes when I'd been trying for days on my own.
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Declan Ramirez
•Wait, how does this actually work? Does it just keep dialing the IRS for you or something?
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Zadie Patel
•Sorry but this sounds like BS. Nobody gets through to the IRS that quickly, especially during tax season. What's the catch? Are they charging a fortune for this "service"?
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A Man D Mortal
•It uses technology to navigate the IRS phone tree and waits on hold for you. When an agent finally picks up, you get a call connecting you directly to them. It essentially does the waiting for you so you don't have to sit on hold for hours. There's no magic trick - it's just automating the painful process of waiting on hold. And yes, it really works! I was skeptical too until I tried it. The IRS is actually quite helpful once you can get someone on the phone - the hard part is just getting through, which is what this service solves.
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Zadie Patel
I have to eat my words about Claimyr. After commenting here, I decided to try it since I had a complicated question about charitable deductions from a fundraising dinner. I'd already spent THREE DAYS trying to get through to the IRS myself. Used the service yesterday afternoon and got a call back in 45 minutes connecting me to an actual IRS agent. The agent confirmed exactly what portion of my charity dinner was deductible and helped me understand how to document it correctly. Would have taken me weeks to get this resolved on my own if I ever got through at all.
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Emma Morales
Don't forget you need to itemize deductions to claim charitable contributions! If your standard deduction is higher (which for many people it is since the tax law changes), then none of this matters anyway. For 2025, standard deduction is $14,600 for single filers and $29,200 for married filing jointly.
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Logan Stewart
•I mentioned in my post that I'm already planning to itemize due to some medical expenses this year, so I should be good! But that's a really important point for others to consider.
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Katherine Hunter
•Are there any situations where you can deduct charitable contributions even if you take the standard deduction?
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Emma Morales
•You're right, I missed that part about you already planning to itemize - glad you're on top of it! There actually is one exception that allows charitable deductions even with the standard deduction. During the pandemic, there was a temporary provision allowing up to $300 ($600 for married filing jointly) in charitable cash contributions to be deducted without itemizing. However, that provision expired and isn't available for 2025 tax filings unless Congress renews it.
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Lucas Parker
Make sure the organization is actually qualified by the IRS as a 501(c)(3) nonprofit! Just because they're doing a fundraiser doesn't automatically mean donations are tax-deductible. You can check an organization's status using the IRS Tax Exempt Organization Search tool online.
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Donna Cline
•This happened to me! Donated $2,000 to what I thought was a charity, then found out they were a 501(c)(4) organization, not a 501(c)(3). Couldn't deduct a penny of it. Always check first!
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Logan Stewart
•It's definitely a qualified 501(c)(3) - it's my kid's public school foundation. Good reminder though! I hadn't thought about checking that.
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Mia Green
One more thing to keep in mind - make sure you keep all the documentation from the charity event! You'll need the receipt showing the amount you paid, the fair market value of the item, and confirmation that the organization told you the deductible portion. The IRS requires written acknowledgment from the charity for any contribution over $250, and for quid pro quo contributions (where you get something in return) like your auction purchase, they must provide a good faith estimate of the value of goods or services you received. Since your total payment was $1100, you definitely need that written documentation to support the $250 deduction.
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Caleb Stone
Great question about silent auction deductions! I went through something similar last year with my daughter's dance studio fundraiser. What really helped me was understanding that the charity is required to provide you with a written acknowledgment that clearly states both the amount you paid AND the fair market value of what you received. Since your payment was over $250, they're legally required to give you this documentation. If that thank you letter was incomplete, I'd definitely follow up with the school's fundraising coordinator to get the complete acknowledgment. They should have a standard form they use for auction winners that breaks down exactly what portion is tax-deductible. Also, keep your auction paddle number and any bidding sheets if you have them - sometimes the IRS wants to see the complete paper trail showing you actually participated in a legitimate auction rather than just making a purchase. Good luck with your taxes!
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Isaiah Sanders
•That's really helpful advice about following up for the complete documentation! I didn't realize they were legally required to provide that breakdown for payments over $250. I'll definitely contact the school's fundraising office to get the proper acknowledgment form. Quick question - you mentioned keeping the auction paddle number and bidding sheets. I think I still have my paddle number somewhere, but I'm not sure about bidding sheets. Do you know if those are absolutely necessary, or would the final receipt with my paddle number be sufficient to show I participated in the actual auction?
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