Latest Newsletter Edition

Tax Tip: 2020 Charitable Contributions Deduction

Ordinarily, only taxpayers who itemize deductions may deduct charitable contributions on their federal tax returns. However, the CARES Act allows many people who do not itemize to claim a deduction for 2020 cash contributions to IRS-approved charities. Tax deductions lower a person’s tax bill by reducing taxable income.

In general, individuals and couples who do not itemize deductions may deduct up to $300 for cash contributions made to qualifying charitable organizations in 2020. Qualifying organizations include many nonprofits dedicated to educational, religious, literary, and disaster and hunger relief activities. The IRS provides an online search tool (link below) to help taxpayers determine whether a particular charity qualifies to receive tax-deductible donations.

As a reminder for those who do itemize deductions, the CARES Act also sets the 2020 cash contributions itemized deduction limit at 100% of adjusted gross income (AGI) for most taxpayers, a temporary increase from the usual limit of 60% of AGI. Qualifying 2020 cash contributions in excess of the limit may be carried over as deductions for tax year 2021.

A tax professional can help you determine whether your contributions qualify for these special rules, and how to claim your deduction if so.

IRS Charitable Organizations Search Tool: https://www.irs.gov/charities-non-profits/tax-exempt-organization-search

 

Greber Tax Advisors does not warrant the accuracy of the information contained herein, nor is it responsible for any errors or omissions and assumes no liability for its use.  The information provided is not intended to be construed as a substitute for obtaining proper expert advice from recognized professionals in their related fields.  Links to third-party websites are provided as a courtesy. The materials on third-party sites are provided “as is” and without warranties of any kind either express or implied.  Greber Tax Advisors exercises no control over the views, accuracy, copyright or trademark compliance or the legality of the material contained on third party sites and does not sponsor, endorse or approve the information, content, products, materials, opinions or services contained on such external sites.  The visitor proceeds to these external sites at their own risk.  Greber Tax Advisors disclaims any and all liability from damages which may result from the accessing this website, or that of a third party site which is linked to the Greber Tax Advisors website, or from reliance upon any and all information contained therein.