The Department disallowed my charitable deductions even though I sent in donation lists. Why isn't my documentation good enough?

Plain-English summary

This taxpayer claimed charitable-contribution itemized deductions for 2020, 2021, and 2022. Under audit the Department asked him to prove the gifts; he sent donation lists. The Department disallowed the deductions and assessed the tax, and on appeal the Tax Commissioner upheld the assessments — because the documentation was not credible.

Why the lists were rejected. The Department discovered that at least 14 of the taxpayer's donation lists were exact copies of lists submitted by multiple other taxpayers during the same years, and that his application for correction was itself identical or nearly identical to those filed by those other taxpayers. In other words, the "proof" wasn't a genuine record of his donations — it was mass-produced paperwork circulating among many filers. Documentation like that can't substantiate anyone's deduction.

The legal backbone. Virginia itemized deductions follow the federal ones (§ 58.1-322.03), Virginia conforms to the Internal Revenue Code (§ 58.1-301), and charitable deductions are allowable only when substantiated — receipts or cancelled checks, a contemporaneous written acknowledgment from the charity for any gift of $250 or more, and additional proof for gifts of property (Treas. Reg. § 1.170A-13). Taxpayers must keep records sufficient to establish their correct liability (Treas. Reg. § 1.6001-1(a); § 58.1-310). And a Department assessment is prima facie correct (§ 58.1-205), so the burden is on the taxpayer to prove it wrong — a burden that duplicated, non-genuine lists do not meet.

Bottom line. The assessments stand. The taxpayer will get updated bills with accrued interest and must pay within 30 days to avoid more interest and possible collection. This determination is the full write-up for a series of materially identical June 30, 2025 rulings addressing the same shared-donation-list pattern — see the light-touch companions at P.D. 25-96 (a married couple), P.D. 25-97 (17 copied lists), and P.D. 25-99 (a single 2020 year).

What this means for you

Anyone deducting charitable contributions

Your deduction is only as good as your own, genuine records. A generic list of donated items — especially one you didn't personally create from real receipts and acknowledgments — is not substantiation. Keep the actual receipts, cancelled checks/bank records, and written acknowledgments (required for any single gift of $250 or more), and for donated property keep the added proof the property tiers require. If your file for an audit is a spreadsheet someone handed you, you don't have substantiation.

A warning about "donation list" services

The Department can and does compare documentation across taxpayers. Here it caught the same lists showing up in many people's files and even identical appeal letters — a strong sign of a promoted scheme. If a preparer or service offers to supply donation lists or boilerplate appeal letters to inflate charitable deductions, walk away: the deductions will be disallowed, interest accrues, and you may face collection — and schemes like this can draw penalties and referrals beyond just the tax.

Tax preparers

Substantiate charitable deductions from client-specific source documents, never shared or templated lists. Recognize the exposure: the Department detected this pattern by matching exact-copy lists and near-identical applications across filers. Advise clients that under § 58.1-205 the assessment is presumed correct and the burden to prove otherwise is theirs — met only with genuine, contemporaneous records.

Common questions

Q: I gave the Department a list of my donations. Why isn't that enough?
A: A list, by itself, isn't substantiation — and here the lists were found to be exact copies shared among many taxpayers, so they weren't credible evidence of this taxpayer's own gifts. You need genuine receipts, bank records or cancelled checks, and (for any gift of $250 or more) a written acknowledgment from the charity.

Q: The Department said my documents matched other people's. What does that mean for my case?
A: It means your "proof" wasn't accepted as genuine. When the same donation lists and near-identical appeal letters appear across multiple taxpayers, the Department treats them as non-credible, and since the assessment is presumed correct, the deductions are disallowed.

Q: Can I still fix this?
A: Only with real substantiation. If you actually made the donations, gather your own contemporaneous receipts, bank/cancelled-check records, and $250+ acknowledgments (plus property-gift documentation where it applies). Absent that, the assessment stands and is due within 30 days of the updated bill.

Q: Are P.D. 25-96, 25-97, and 25-99 different rulings?
A: They resolve separate taxpayers' appeals but on the same facts and reasoning as this one — copied donation lists in 2020–2022 (25-97 involved 17 copied lists; 25-99 a single 2020 year; 25-96 a married couple). We publish this ruling as the full explanation and the others as short companions.

Citations and references

Statutes and regulations:

• Va. Code § 58.1-1821 — application to the Tax Commissioner to correct an assessment
• Va. Code § 58.1-301 — Virginia conforms to the Internal Revenue Code (starts from FAGI)
• Va. Code § 58.1-219, § 58.1-310 — the Department may adjust IRC-inconsistent itemized deductions and require the federal return and records
• Va. Code § 58.1-322.03 — Virginia itemized deductions, tied to the federal itemized deductions
• Va. Code § 58.1-205 — a Department assessment is prima facie correct; burden of proof on the taxpayer
• Treas. Reg. § 1.170A-13 — substantiation requirements for charitable contributions (including the $250 contemporaneous written acknowledgment and property-gift rules)
• Treas. Reg. § 1.6001-1(a) — taxpayers must keep records sufficient to determine their correct tax liability

Prior public documents the Commissioner relied on (described here, not linked): P.D. 19-78 (7/29/2019) and P.D. 23-24 (3/1/2023), on the documentation required to substantiate charitable-contribution deductions.

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 25-95

Original ruling text

June 30, 2025

Re: § 58.1-1821 Application: Individual Income Tax

Dear * :

This will respond to your letter in which you seek correction of the individual income tax assessment issued to * (the “Taxpayer”) for the taxable years ended December 31, 2020, 2021, and 2022.

FACTS

The Taxpayer filed Virginia resident income tax returns for the taxable years at issue, claiming charitable contributions as itemized deductions reportable on federal Schedule A. Under audit, the Department requested documentation to support the deductions. The Taxpayer submitted some documentation, but the auditor determined that it was insufficient to support all of the claimed deductions and issued assessments accordingly. The Taxpayer submitted an application for correction, asserting that he provided sufficient documentation to support the deductions.

DETERMINATION

Conformity

Virginia Code § 58.1-301 provides, with certain exceptions, that terminology and references used in Title 58.1 of the Code of Virginia will have the same meaning as provided in the Internal Revenue Code (IRC), unless a different meaning is clearly required. Conformity does not extend to terms, concepts, or principles not specifically provided in the Code of Virginia . For individual income tax purposes, Virginia conforms to federal law, in that it starts the computation of Virginia taxable income with federal adjusted gross income (FAGI). Income properly included in the FAGI of a Virginia resident is subject to taxation by Virginia, unless it is specifically exempt as a Virginia modification pursuant to Chapter 3 of Title 58.1 of the Code of Virginia .

Generally, the Department relies on the accuracy of information and computations reflected on the federal income tax return when reviewing Virginia individual income tax returns. If the information provided on the federal return appears reasonable, then, typically, the Department does not look behind those computations. The Department, however, may examine and adjust the FAGI and itemized deductions where there is clear evidence that the amounts reported on the federal or Virginia income tax return are inconsistent with the IRC. See Virginia Code § 58.1-219 and § 58.1-310.

Itemized Deductions

Virginia Code § 58.1-322.03 1 allows taxpayers to deduct from their Virginia adjusted gross income certain amounts allowed for itemized deductions for federal income tax purposes. These deductions include those for real estate taxes, home mortgage interest, personal property taxes, medical expenses, and charitable contributions, provided they are claimed in accordance with the IRC and its related regulations.

The Department requested that the Taxpayer provide documentation supporting the charitable contribution deductions claimed on his Schedules A for the taxable years at issue. The requests indicated the specific documentation required to substantiate the deductions. Deductions for charitable contributions are allowable only when they can be substantiated through items such as receipts or cancelled checks. See Public Document (P.D.) 19-78 (7/29/2019) and P.D. 23-24 (3/1/2023). Any contribution over $250 must have a contemporaneous written acknowledgment from the donee indicating whether any goods or services were provided by the donee in connection with the contribution, and if so, what the value of those goods or services were. See Treas. Reg. § 1.170A-13(f)(2). Additional substantiation is required for gifts of property other than money. See Treas. Reg. § 1.170A-13.

Taxpayers must maintain records sufficient to allow the IRS to determine their correct tax liability. See Treas. Reg. § 1.6001-1(a). Similarly, Virginia Code § 58.1-310 provides:

Whenever in the opinion of the Department it is necessary to examine the federal income returns or any copy thereof of any individual, estate, trust, partnership or corporation in order properly to audit such returns, the Department or the commissioner of the revenue shall have the right to require such taxpayer to provide such return or a copy thereof and all statements, inventories, and schedules in support thereof.

Under the provisions of Virginia Code § 58.1-205, in any proceeding relating to the interpretation of the tax laws of Virginia, an “assessment of a tax by the Department shall be deemed prima facie correct.” As such, the burden of proof is on the Taxpayer to show that the Department’s assessment was erroneous.

The Department reviewed the documents submitted by the Taxpayer to substantiate his deductions and discovered that at least 14 of the Taxpayer’s donation lists were exact copies of lists submitted by multiple other taxpayers during the taxable years at issue. In addition, the Taxpayer’s application for correction was also identical, or nearly identical, to that submitted by such other taxpayers. In light of this finding, the Department cannot accept the documentation submitted by the Taxpayer as substantiation for his claimed deductions. Accordingly, the Department’s assessments are upheld.

The Taxpayer will receive updated bills that will include accrued interest to date. The Taxpayer should remit the balances due within 30 days of the bill dates to avoid the accrual of additional interest and possible collection actions.

The Code of Virginia sections cited are available online at law.lis.virginia.gov. The public documents cited are available at tax.virginia.gov in the Laws, Rules, & Decisions section of the Department’s website. If you have any questions regarding this decision, you may contact * in the Office of Tax Policy and Legal Affairs, Tax Adjudication and Resolution Division, at or **.

Sincerely,

James J. Alex

Tax Commissioner

Commonwealth of Virginia

AR 4986.Q

Related Documents

19-78

23-24