This time of year, many groups are asking for donations, often highlighting tax advantages before the year ends. But taking charitable deductions isn’t for everyone. Only people who itemize their tax deductions can include charitable donations with appropriate receipts. If you take the standard deduction, which most people do, you cannot.
For this tax year, the standard deduction is $13,850 for single filers, $27,700 for joint filers or $20,800 for heads of households. The standard deductions for 2023 were increased from 2022, based on inflation. People 65 and older may be eligible for a higher amount.
If charitable contributions and IRS-recognized expenses are more than the standard deduction, they can be itemized. Depending on the type of charitable donations and organizations, filers can deduct up to 60% of their adjustable gross income.
To claim a charitable deduction, the organization must be recognized by the IRS and filers should not have received anything in return for their donation. Always check IRS guidelines or consult a tax expert to confirm eligible deductions, which can lower taxable income.
