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Answering the Top Questions About Charitable Donation Tax Deductions

It’s extremely rewarding to support causes you value, and that’s the main reason people give! But it’s natural to wonder if there can also be some tax benefits to your giving. This article answers the most common questions about charitable donation tax deductions in the US.


 

The Tax Cuts and Jobs Act of 2017 raised the standard deduction and simplified taxes for millions of households. This article answers the top questions related to tax deductions, including charitable donation tax deductions. This is for information purposes only and should not be considered tax advice.

Can my charitable donation get me a tax deduction?

Yes! Most Americans now opt for the standard deduction (see next question), which surpasses itemized tax deductions for most households. This used to mean that for most households, there was no additional tax benefit for charitable donations.

However, with the The Taxpayer Certainty and Disaster Tax Relief Act of 2020, even households taking the standard deduction can get an additional tax deduction for charitable donations, of up to $300 for taxpayers filing as individuals, and $600 for married individuals filing joint returns.

If you expect your combined deductions to exceed the standard deduction, then it’s worth considering itemizing your taxes, including charitable donations. If you itemize, the new law also increases the charitable deduction limit to 100% of your adjusted gross income for qualified donations made in 2021.

What to know about deducting charitable donations from taxes:

    1. Only donations to US-based 501(c)(3) charities are eligible for tax deductions.

    Lots of donors want to safely give to the causes that they care about internationally, including disasters, while also receiving the benefits of giving to a US-based charity. GlobalGiving makes that possible. We have thousands of vetted nonprofit partners all over the world (170 countries and counting) doing everything from reforesting the Amazon to providing care for adults with disabilities. Your donation to GlobalGiving is tax-deductible because we are a registered 501(C)(3) organization. For US tax purposes, our Employer Identification Number is 30‑0108263. If you are a UK taxpayer, your gift may also be tax-deductible. Our UK Charity Number is 1122823.

    2. You’ll need documentation.

    Hang on to your thank you or acknowledgement emails/letters from organizations you support. Alternatively, many nonprofit organizations, including GlobalGiving, send a year-end giving summary to donors.

What’s the standard deduction?

The standard deduction is the portion of income not subject to tax that can be used to reduce your tax bill. Here’s what that number is for households in 2021:

  • Single/filing separately: $12,550
  • Head of household: $18,800
  • Married filing jointly: $25,100
  • What’s my tax bracket?

    It’s important to remember that federal income taxes are incremental, so however far you are into the next tax bracket, only that amount will be taxed at the higher rate. Here are the latest tax brackets:

    2021 tax brackets

    What can I deduct from my taxes?

    If you’re considering itemizing, here are the most common tax deductions to keep in mind:

    • Property Taxes
    • Mortgage Interest
    • State and Local Taxes
    • Real Estate Expenses
    • Charitable donations
    • Medical Expenses
    • Some Education Expenses
    • Some Retirement contributions
    • Some Health Care Costs
  • Student Loan Interest
  • Conclusion

    Whether or not tax benefits are a factor in your giving, we’re thrilled it’s on your mind. This is the most common time of year for giving back, and your generosity can move forward your favorite causes before the new year.

    Want to learn more? Check out our articles on Giving Back with Tax Benefits, and Giving with your IRA.

    For a unique way to give back this season, browse inspiring causes around the world, and choose a project that resonates with you.

    FIND A PROJECT

    Featured Photo: Economic Empowerment for 300 Indigenous Maya Women by GRACE Cares, Inc.

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