Special $300 IRS Charitable Tax Deduction for 2020 During COVID-19

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Services for Real Estate Pros with Howard Richardson
https://activerain.com/droplet/5pPd

Cash donations up to $300 made to qualified charities during 2020 will be an adjustment to gross income deduction. Taxpayers that use the standard deduction and do not itemized deductions on Schedule A (Form 1040) can temporarily take the full deduction above the line (above Adjusted Gross Income: AGI). This will lower both AGI and taxable income resulting in a lower tax liability.

 

Normally, only individuals with itemized deductions greater than the standard deduction benefit from charitable contributions. Homeowners paying mortgage interest expenses and real property taxes are more likely than renters to itemize deductions and file a Schedule A (Form 1040). Almost 90% of taxpayers use the standard deduction, so this new change that is part of the Coronavirus Aid, Relief and Economic Security Act (CARES) will allow more taxpayers to benefit from their donations. This is due in part because charities have received fewer donations this year as a result of higher unemployment and underemployment during COVID-19. Citizens donating to charities take the financial burden off of government to aid in relief efforts. That means the IRS will have to raise less money in taxes to pay for products and services that are provided by charities to communities instead of the government. The IRS in turn wants to reward donors for helping the country.

 

Be sure to get a receipt or a letter from the charity confirming your payment. Keep a copy of your cancelled check or credit card receipt. You will need this for your records to prove your donation in the event of an audit. Check the IRS website to ensure the Tax Exempt Organization you are donating to is legitimate in order for your charitable deduction expense to be accepted.

 

Howard Richardson

IRS and State Tax Representation

8939 S. Sepulveda Blvd., Ste. 102

Los Angeles, CA 90045

(323) 374-5034

howard@hrichtax.com

www.hrichtax.com

 

 

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Rainmaker
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Ron and Alexandra Seigel
Napa Consultants - Carpinteria, CA
Luxury Real Estate Branding, Marketing & Strategy

Howard,

Thank you for this information.  I will keep it in my mind as I just did send and gave more than that.  A

Dec 08, 2020 01:11 PM #1
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