IRS charitable contribution deduction for 2021 helps more taxpayers deduct donations to qualifying charities.
For the 2020 tax year, the IRS implemented the CARES Act, which created an above-the-line charitable contribution deduction. Therefore, taxpayers could deduct cash donations made to charities even if they did not itemize deductions on their tax returns. Above-the-line deductions refer to the ability to deduct the donation from your overall Adjusted Gross Income, or AGI. The IRS has extended this Charitable Tax Deduction for the 2021 tax year through the Consolidated Appropriations Act with a few important changes.
The experience IRS tax attorney at Columbus, Ohio based Porter Law Office, LLC helps individuals and businesses across the U.S. If you have any questions about your 2021 taxes, contact our office today.
Special Tax Deduction Helps Give to Charities
This year, on your 2021 federal tax return, individual tax filers, including married individuals filing separately, will be able to claim a deduction of up to $300 for cash contributions made to qualifying charities during 2021. Joint tax filers will be able to deduct $600 in charitable contributions.
This deduction, however, is now a “below-the-line” deduction. Below-the-line deductions are deductions that only reduce your taxable income, not your AGI. This deduction on the 2021 1040 is seen quite literally “below” your AGI as item 12b.
The distinction between above-the-line and below-the-line deductions is very important for some individuals who are on the cusp of a higher tax bracket. It is also important for individuals who are close to thresholds when it comes to certain tax credits. For most of individuals, and especially those filing married filing joint tax returns, this deduction is a benefit for not only them, but for charitable organizations across the United States.
Contact an Experienced Columbus, Ohio Tax Attorney
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If you have charitable contribution deduction questions for 2021, contact the experienced Columbus, Ohio tax lawyer at Porter Law Office, LLC today for a case evaluation. Our firm handles complex IRS tax controversies. Contact the experienced Columbus, Ohio tax attorney at Porter Law Office, LLC today for a consultation to discuss your particular IRS tax needs and options.