2020 Charitable Contributions for Income Tax Purposes

What a year this has been.  So many events never dealt with.  And, as we approach the end of the year, perhaps you are thinking about charities that you have or would like to support but feel that because you don’t itemize deductions on your personal income tax returns, you don’t get the benefit of any contributions.  Well, one positive change this year has brought is that you do NOT have to itemize deductions to get the benefit of charitable CASH contributions of up to $300 to qualifying organizations.  This is thanks to the CARES Act. 

You may not think that $300 is enough to make a difference but that is $300 off of your taxable income and could even be what is needed to reduce your tax bracket. 

But, remember, it has to be to a “qualified” organization.  It cannot be to a Go Fund Me account or donations made to a grieving family, etc.

So, what is a “qualified” charity?  Religious, charitable, educational, scientific or literary in purpose.  If you would like more information about qualifying charity, visit irs.gov and do a “Tax Exempt Organization” Search, review Publication 526 – Charitable Contributions, or Tax Topic 506. 

If you itemize deductions, unfortunately you will not get the benefit of the $300 as your charitable donations will be itemized on your Schedule A.  If you itemize your deductions, always make certain to keep receipts for all donations – cash and/or non-cash.  If you need some guidance with non-cash contributions, visit irs.gov and look for Publication 561 and Form 8283. 

Finally, if you have reached the magical age for required minimum distributions from your IRA, you are eligible to make a charitable contribution from your IRA of up to $100,000 directly to the charity which will count toward your minimum distribution requirement for the year.  Check with your financial advisor or accountant for further information.

Happy contributing.

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About the Author

Kay Sowa is a paralegal in the Trusts and Estates Group at Capehart & Scatchard, P.A. She is an IRS Enrolled Agent, an Accredited Estate Planner®, and a Certified Trust and Fiduciary Advisor. She oversees the trust and estate administration practice for the firm. She is an accomplished author and lecturer who has frequently spoken on behalf of a number of organizations including the National Business Institute and the Institute of Paralegal Education.

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