Charitable Contribution Deduction - Explained
What is a Charitable Contribution Deduction?
Written by J. Mance Gordon
Updated at April 18th, 2024
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How Does a Charitable Contributions Deduction Work?
The charitable contributions tax deduction allows a taxpayer to deduct from their taxable income the amount of money or value property donated to a qualifying charitable entity. The deduction is subject to numerous limitations.
To be a qualified charitable organization under IRC 170(c). For donations to most organizations, the deduction is capped at 50% of the donors adjusted gross income. The deduction is 30% on contributions to fraternal organizations, cemeteries, and veteran groups. The deduction must be taken in the year that the funds or property is donated to the qualifying charity. The charitable contributions tax deduction for individuals is recorded on Schedule A of Form 1040.