Each year, individuals and families contribute thousands of pounds of tangible personal property – such as gently used clothing, old toys, furniture and household appliances – to local charities. In turn, charities provide all manner of thank-you letters, written acknowledgements and receipts as proof of the donation. Often these receipts are discarded or forgotten until tax time, when donors are reminded that they can claim a charitable deduction.
Besaw v. Commissioner Case
The U.S. Tax Court's decision in Besaw v. Commissioner on July 21, 2025, delivers a clear message to anyone claiming charitable deductions: Proper documentation is not just recommended, it is absolutely mandatory.
In the case surrounding a federal income tax deduction claimed for $6,760 in noncash charitable donations, the judge explicitly stated, "[T]he Court believes petitioner donated items to charitable organizations in 2019," yet still disallowed John Besaw's entire deduction due to incomplete charity receipts. This ruling reinforces that even undisputed charitable giving provides zero tax benefit without meticulous documentation by donors.
The donor in Besaw appeared to do many things correctly: He properly filed Form 8283 listing the donated items and charity names, and even obtained dated, signed receipts from the charitable organizations. However, these receipts contained a flaw that cost him the entire deduction. As the court noted, "[T]he sections on the receipts to identify the goods donated and their values have all been left blank." When the taxpayer attempted to remedy this deficiency by creating detailed reconstruction documents after filing his return – listing donation dates, item descriptions and values – the court rejected these efforts. The ruling was unequivocal, with Tax Court Special Trial Judge Diana Leyden noting, "[N]one of the receipts he provided from the charitable organizations for his donations included any descriptions of the donated items; therefore, petitioner is not entitled to deduct noncash charitable contributions."
Key Reminders
This decision highlights that donors must understand proper documentation requirements to realize the tax benefits of charitable giving. For contributions of less than $250, donors must maintain bank records or written communications from the charity showing the organization's name, date and amount. For contributions of $250 or more, donors must obtain a "contemporaneous written acknowledgment" that includes whether any goods or services were provided in return – and critically, must include adequate descriptions of donated items. For noncash contributions of more than $500, donors must complete Form 8283, and contributions of more than $5,000 require qualified appraisals. Additionally, household items must be "in good used condition or better" to qualify for any deduction.
The stakes for proper documentation have never been higher for clients. With the One Big Beautiful Bill Act introducing new charitable deduction rules starting in 2026 – including a deduction for non-itemizers and a 0.5 percent adjusted gross income (AGI) floor for itemizers – and the IRS deploying $80 billion in new funding for artificial intelligence-powered audit technology, charitable deductions face unprecedented scrutiny. It is recommended that clients verify that all charity receipts contain detailed item descriptions and the required "no goods or services" language before filing. And, although the burden is on the donor to comply with substantiation requirements, many donors will assume the charities are properly advising them on what they need to do. Given the importance of managing donor relationships, organizations should take steps to help donors comply with their obligations. As Besaw demonstrates, there are no second chances to fix documentation problems after the fact: Proper records must be obtained in a timely manner.
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