The Internal Revenue Service is reminding taxpayers that a special tax provision this year will allow for a $600 deduction for donations to a qualified charity.
Generally, if a person takes the standard deduction on their income tax return, they are not eligible to take a deduction for donations.
This year, however, the special provision allows a limited deduction for cash contributions to organizations the IRS has deemed qualifying charitable organizations.
Under the temporary law change, individual tax filers and married individuals filing separate returns can claim on their 2021 federal income tax return a deduction of up to $300 for cash contributions made to qualifying charities during 2021. The maximum deduction amount is now increased to $600 for married individuals filing joint returns.
According to the IRS, “cash contributions include those made by check, credit card or debit card as well as amounts incurred by an individual for unreimbursed out-of-pocket expenses in connection with their volunteer services to a qualifying charitable organization.
“Cash contributions don’t include the value of volunteer services, securities, household items or other property.”
Contributions made either to supporting organizations or to establish or maintain a donor-advised fund do not. Contributions carried forward from prior years do not qualify, nor do contributions to most private foundations and most cash contributions to charitable remainder trusts, the IRS said.
To check the status of a charity, they can use the IRS Tax Exempt Organization Search tool.
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