What defines the difference between a gift and a donation? Providing materials to help neighbor rebuild.

[dustin2]

My home and obviously many of my neighbors homes were wiped out by an EF-4 tornado in December.  I purchased and gave my next door neighbor some materials to aid in their rebuilding process.  For tax purposes would this qualify as a gift or a donation.  Also what, if any, ramifications would it have on my neighbors if I put this on my taxes for this year.  The total cost of the materials was $2,500, and while it would be nice to be able to deduct some of that off my taxes, the last thing I want to do is have it be detrimental to my neighbors in any way, shape, or form.  Helping them is what matters most.

[Carl]

You're a wonderful person for helping your neighbors, and I commend you for that. A gift can be given to anyone or any organization. So long as that gift does not exceed $14K to any one person, absolutely no tax reporting of any type is required by either the giver or the recipient.

A donation is something given to a "qualified" charitable organization, and depending on the type of organization, either 30% or 50% of that donation is deductible.

[dustin2]

Thank you, that's what I thought.  I appreciate the clarification.

[DoninGA]

You cannot make a charitable donation to an individual and claim it as a charitable donation on your tax return.  Charitable donations can only be made to a recognized charitable institution.

Your generous gesture of providing building materials was a gift.  Gifts given to an individual of of $14,000 or less during the year are not reported on a tax return.  Gifts received from an individual are not reported on a tax return, regardless of the amount received.

[dustin2]

Thanks, that's what I thought, I appreciate the feedback!