Are Donations to Nursing Homes Tax Deductible?

Many individuals support nursing homes through contributions to enhance the quality of life for residents. These donations can provide facilities with resources for activities, comfort items, or general operational needs. The motivations are often personal, stemming from a desire to assist the elderly population.

Determining Tax Deductibility

The ability to claim a tax deduction for a donation to a nursing home depends on the facility’s tax status. Contributions are only deductible if made to a “qualified organization,” which the IRS defines as a non-profit entity recognized under section 501(c)(3) of the Internal Revenue Code. These organizations are operated for charitable purposes, making donations to them eligible for tax deductions.

Conversely, many nursing homes operate as for-profit businesses designed to generate revenue for owners or shareholders. Donations made to these for-profit nursing homes are considered gifts to a private enterprise and are not tax-deductible.

Before making a contribution, a donor should verify the nursing home’s tax-exempt status. The most reliable method is using the IRS’s Tax Exempt Organization Search tool on its website. By entering the nursing home’s legal name and location, you can confirm if it is a registered 501(c)(3) organization.

Types of Contributions and Valuation

Donations to qualified non-profit nursing homes can be cash or non-cash property. Cash contributions can be made via check, credit card, or electronic funds transfer. Non-cash donations include physical items like new blankets, books, or furniture for common areas.

When donating non-cash items, the deduction’s value is the item’s “fair market value” at the time of donation. This is the price the property would sell for on the open market. For new items, this is the price you paid, but for used goods, the value is what a buyer would pay for it in its current condition. The IRS provides guidance in Publication 561 on this topic.

Donations to Specific Residents

A distinction must be made between a donation to the facility and a gift to a specific individual. A contribution made directly to a resident is a personal gift and is not tax-deductible. For a donation to be deductible, it must be made to the qualified organization for its use, not for a single, designated person.

Required Documentation for Tax Filings

Proper record-keeping is required to claim a charitable deduction. For any single cash contribution under $250, a reliable bank record like a canceled check or credit card statement is sufficient. A written receipt from the nursing home with its name, the date, and the amount is also acceptable.

For any single donation of $250 or more, you must obtain a “contemporaneous written acknowledgment” from the organization before filing your tax return. This document must include the organization’s name, the contribution date, the cash amount, and a description of any non-cash property. It must also state whether you received any goods or services in exchange and provide a good-faith estimate of their value.

If the total value of your non-cash contributions for the year exceeds $500, you must file IRS Form 8283, Noncash Charitable Contributions, with your tax return. For donations valued at more than $5,000, a formal appraisal by a qualified appraiser is generally required, and the appraiser must also sign the form.

How to Make a Donation

Once you have confirmed a nursing home’s non-profit status, the process of donating is straightforward. First, identify the appropriate person to contact at the facility, such as the administrator or activities director, to discuss your potential contribution.

It is best to inquire about the facility’s current needs to ensure your donation is useful. The staff may have a wish list of specific items, which helps align your gift with what will most benefit the residents. This also prevents you from donating items the facility cannot use due to space or policy constraints.

After determining what to give, coordinate the logistics of the delivery. Ask about the best day and time to drop off items to ensure staff is available to receive them. Scheduling an appointment is helpful for larger donations.