For the 2021 tax year, individual donors who do not itemize deductions can receive a charitable deduction of up to $300 for individuals and $600 for individuals filing joint tax returns.
For individual donors who itemize deductions, charitable deduction to qualified public charities is generally limited to 60% of the individual’s adjusted gross income, but for the 2021 tax year, donors can deduct up to 100% of adjusted gross income for charitable donations made to qualified public charities. The 100% limit is not automatic; the taxpayer must make an election to take the new limit for any qualified cash contribution. Otherwise, the usual limit applies. Cash contributions to most charitable organizations qualify, but, cash contributions made either to supporting organizations or to establish or maintain a donor advised fund, do not. Nor do cash contributions to private foundations and most cash contributions to charitable remainder trusts.
For corporations the allowable charitable deduction is limited to 10% of the corporation’s taxable income. For the 2021 tax year, C corporations must make an election to increase the limit to 25% of taxable income for donations made to qualified charities.
Generally individuals age 70 ½ or over can make a qualified charitable distribution from an IRA account that is paid directly from the IRA to a qualified charity. Qualified charitable distributions can satisfy all or part of the amount of the required minimum distribution.
Please consult your tax advisor to determine whether your donation is tax deductible in whole or in part as the tax laws continue to change.