Some charitable contributions are tax deductible.
You may only deduct charitable donations to qualified charities as an itemized deduction on Schedule A of Form 1040. The Internal Revenue Service lists all qualified charities in Publication 78. The IRS limits you to deductions to 50 percent, 30 percent or 20 percent of your adjusted gross income depending on the type of charity you donate to. Publication 78 tells you if your charity is limited to 20 percent, 30 percent or 50 percent of adjusted gross income. You can only deduct up to the percentage of adjusted gross income for each charity.
Instructions
1. Find each charity on Publication 78. Be sure to list the amount you donated and if the charity is a 20 percent, 30 percent or 50 percent charity. Publication 78 will tell you what type of charity you are donating to. Depending on the type of charity, you can only deduct up to a certain percentage of your adjusted gross income from Form 1040. If you gave to a 50 percent charity and had $100,000 of adjusted gross income, you may only deduct up to $50,000 of the donations you gave to the charity.
2. Group the charities by 20 percent, 30 percent or 50 percent charities. Add together the amount of donations for each charity.
3. Multiply line 37 of Form 1040 by 20 percent, 30 percent and 50 percent. Write down the result for each.
4. Deduct all the 20 percent donations up to 20 percent of your adjusted gross income. Any donations you made above 20 percent of your adjusted gross income, are not deductable.
5. Deduct any 30 percent donations. You need to add the full 20 percent deductions first, and then consider the 30 percent. For example, if you have adjusted gross income of $100,000 and $20,000 in 20 percent deductions, then you can deduct an additional $10,000 of the donations you made to 30 percent charities.
6. Repeat the process figuring in donations you made to 50 percent charities. In the example where you had $100,000 in adjusted gross income and have already deducted $30,000 in donations made to 20 and 30 percent charities, you would only be allowed to deduct $20,000 of the donations you made to 50 percent charities.
