Tax Tip Tuesday 7: Charitable Contributions

Charitable Contributions

Contributions to your favorite church or cause are deductible with a few changes.  In 2017 the deductibility of contributions maxed out at 50% of your adjusted gross income.  For 2018 that limit has been raised to 60%. For those who have contributed to your favorite colleges’ athletic department in exchange for ticket and seating rights, the deduction is no longer available.

Charitable contributions must be made to qualified organizations (To see if your favorite qualifies, go to IRS.gov, click on “tools” and then on “Exempt Organizations Select Check” (IRS.gov/EOSelectCheck)). Prior to 2017, if your donations were questioned and the done organization filed an information return, your contributions were considered substantiated. That is no longer the case.  Make sure the organization you are contributing to has received a letter of recognition as an exempt organization from the IRS (there are no automatic exemptions) and get a receipt for any cash contributions over $75.

Don’t forget to include your out of pocket cost.  As a volunteer, any expenses you incur as a part of the service you provide are a deduction. Some expenses that may be included are:

Travel between your home and the volunteer location

Expenses necessary to attend conventions as a representative of an exempt organization

The cost and maintenance of uniforms

Food, goods, and services donated to youth, individuals, and families that are selected by a charitable organization.

Expenses to go on a mission trip.