Friday we covered the new IRS rules about donating money to charitable causes. Today let's cover the new tax rules covering donations of clothing and other household items to charity.

My wife is a saint. No matter how old the joke gets she always laughs at it. Whenever I get a hole in a sock or one of the dogs chews up a shoe, my standard joke is to "put it in the Goodwill bin". She always laughs, acting like it's the first time she's heard that joke.

There must be more than a few people out there who don't joke about ruined items. Rather than throw them out, they must be taking them to the Goodwill anyway. In fact, there must be so many of them that the organizations who receive these old worn out and/or destroyed items must have complained to the IRS. And this year the IRS has responded with a new rule aimed at people who donate garbage to charity and try to claim a deduction for it.

In order for any clothing or household goods item to be considered a deductible contribution, it must be donated in generally good used condition or better. This new rule applies for any item donated after August 17, 2006, so it covers all who close their fiscal years starting August 17, 2007.

That rule does not apply, however, to more valuable donated items. If you claim a deduction of more than $500 for any single item and you include a qualified appraisal of the item with your return, the item's condition is irrelevant. That one makes sense. If you're donating that civil war uniform authenticated as having been worn by a certain particular general, for instance, its condition, while important, has little to do with its value. That's truly a case of one man's trash being another's treasure.

While we're at it, here is a review of the IRS rules in general for donating items to charity:

• Only contributions made to qualified organizations are deductible. You can't deduct donations to individuals or political campaigns, for example.
• Your contribution must take place during the tax year in which you take your deduction.
• You'll almost always want to deduct according to the fair market value of your donation. This is especially true of donations of stock or other property.
• If you receive anything of value in return for your donation, the fair market value of your donation - and thus your deduction amount - must be reduced by its value.
• If the value of your contribution is $250 or more, you can only deduct it if you have a written acknowledgment of the donation from the qualified organization receiving the contribution.
• If the value of your contribution is $5000 or more, you will need to complete Section B of IRS Form 8283. This form requires you to attach an appraisal by a qualified appraiser.