You May Be Able To Deduct Charitable Donations Even If You Don't Itemize

Nearly three in four U.S. adults donated money to a charitable organization in the past year, according to a Gallup poll. Even during a time of uncertainty, Americans have opened up their heart and wallets to help each other and this year, that generosity may be partially returned thanks to the IRS. In a typical year, charitable contributions would only be beneficial if you were itemizing your deductions on your tax return. Considering many get a better tax rate by using the standard deduction, it meant those charitable donations couldn't be claimed.  However a provision in the CARES Act allows those who take the standard deduction to still account for the donations you made this year of up to $300 for cash contributions to qualifying organizations (does not include item donations). It also changed for those who do itemize.  Previously, you could only deduct 60% of your income when donating to public charities, but now you can deduct 100%. And, if you donated more than your total yearly income, those contributions can be carried onto your future tax deductions for up to five years. So, if you donated under $300, and have no other deductible income like medical expenses or mortgage interest deductions, you'll end up saving more money by taking the standard deduction and adding on that $300 charitable donation deduction. Now may be a good time to schedule an appointment with an accountant to review your finances for the year to see if you need to file taxes differently for 2020.

SOURCE: Apartment Therapy

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