IRS Charitable Deduction Limitations
There is no set maximum charitable contribution amount for income tax deductions, but there is a maximum amount you can claim based on a percentage of your adjusted gross income. Generally, you cannot claim a deduction for charitable contributions that total more than 50 percent of your adjusted gross income.
Size
In any one tax year, you cannot claim total charitable contributions that are more than 50 percent of your adjusted gross income. Adjusted gross income is your gross income less adjustments to income. Common adjustments to income include alimony payments and qualified retirement account contributions. Adjustments to income do not include deductions such as the standard deduction or itemized deduction. In other words, your adjusted gross income is your income before you claim your deductions.
Time Frame
If your total charitable contributions happen to exceed more than 50 percent of your adjusted gross income then you can carry over the excess amount to a future year. Generally, you can use the carryover amount anytime within the following five tax years.
Types
Charitable contributions can take the form of either cash or other types of property, including personal property and real property. The deduction limits are the same regardless of whether you gift money or property, though the record-keeping requirements can vary. Gifts of property worth more than $5,000, for example, require a written appraisal, while cash gifts require either a receipt or a bank record evidencing the payment.
30 Percent Limit
Some charitable contributions are limited to 30 percent of your adjusted gross income, rather than the more generous 50 percent limitation. The distinction depends on the type of organization that you donate your money or property to. Contributions to most charitable organizations fall under the 50 percent rule, but some contributions do not. 30 percent limit organizations include veterans' organizations, fraternal societies, nonprofit cemeteries and some types of private foundations. Most organizations are 50 percent limit organizations, and those that are not are specifically listed in IRS Publication 78 as 30 percent limit organizations.
Warning
You cannot deduct the amount of any contribution for which you receive a corresponding personal benefit. For example, if you contribute $200 to a qualifying nonprofit museum, and in exchange you receive a free annual membership to the museum's exhibit, you cannot deduct the entire $200. If an annual membership sells for $100, you can only deduct the remaining $100 as a charitable contribution.
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