COVID Tax Tip 2020-153: How the CARES Act changes deducting charitable contributions

IRS Tax Tips November 12, 2020
Useful Links: IRS.gov Help For Hurricane Victims News Essentials What's Hot News Releases IRS - The Basics IRS Guidance Media Contacts Facts & Figures Around The Nation e-News Subscriptions The Newsroom Topics Multimedia Center Noticias en Español Radio PSAs Tax Scams/Consumer Alerts The Tax Gap Fact Sheets IRS Tax Tips Armed Forces Latest News IRS Resources Compliance & Enforcement News Contact Your Local IRS Office Filing Your Taxes Forms & Instructions Frequently Asked Questions Taxpayer Advocate Service Where to File IRS Social Media	Issue Number: COVID Tax Tip 2020-153 How the CARES Act changes deducting charitable contributions Whether taxpayers are supporting natural disaster recovery, COVID-19 pandemic aid or another cause that's personally meaningful to them, their charitable donations may be tax deductible. These deductions basically reduce the amount of their taxable income. Here's how the CARES Act changes deducting charitable contributions made in 2020: Previously, charitable contributions could only be deducted if taxpayers itemized their deductions. However, taxpayers who don't itemize deductions may take a charitable deduction of up to $300 for cash contributions made in 2020 to qualifying organizations. For the purposes of this deduction, qualifying organizations are those that are religious, charitable, educational, scientific or literary in purpose. The law changed in this area due to the Coronavirus Aid, Relief, and Economic Security Act.  The CARES Act also suspends limits on charitable contributions and temporarily increases limits on contributions of food inventory. More information about these changes is available on IRS.gov. Here are some resources for people making donations: Tax Exempt Organization Search Taxpayers must give to qualified organizations to deduct their donations on their tax return. They can use this tool to find out if a specific charity qualifies as a charitable organization for income tax purposes. Publication 526, Charitable Contributions This publication explains how taxpayers claim a deduction for charitable contributions. It goes over: How much taxpayers can deduct. What records they must keep. How to report contributions. Publication 561, Determining the Value of Donated Property Taxpayers generally can deduct the fair market value of property they donate. This publication helps determine the value of donated property. Form 8283, Noncash Charitable Contributions Taxpayers must file Form 8283 to report noncash charitable contributions if the amount of this deduction is more than $500. The instructions for this form walk taxpayers through how to complete it. Schedule A, Itemized Deductions Taxpayers deducting donations do so on Schedule A. The instructions for this form include line-by-line directions for completing it. Frequently asked questions: Qualified charitable distributions Taxpayers age 70 ½ or older can make a qualified charitable distribution from their IRA – up to $100,000 – directly to an eligible charity. It's generally a nontaxable distribution made by the IRA trustee to a charitable organization. A QCD counts toward their minimum distribution requirement for the year. More information: Tax Topic 506, Charitable Contributions Deducting Charitable Contributions at a Glance   Share this tip on social media -- #IRSTaxTip: How the CARES Act changes deducting charitable contributions. https://go.usa.gov/x79jx Back to Top         Thank you for subscribing to IRS Tax Tips, an IRS e-mail service. For more information on federal taxes please visit IRS.gov. This message was distributed automatically from the IRS Tax Tips mailing list. Please Do Not Reply To This Message.

 

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