Charitable Contributions Tax Deduction

Donating to charity not only benefits those in need, but it can also give you a tax deduction. Charitable Contributions use to only be allowed if you itemized; however, starting with tax year 2026, single filers that take the standard deduction can deduct up to $1,000 ($2,000 for joint filers) of cash contributions to qualified organizations.

What is a qualified organization?

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In most cases a qualified organization is a nonprofit that relies on donations from the public to support their mission. 501(c)(3) organizations are the most common type of nonprofit; however, there are different types and not all of them rely on public donations. If you are not sure about a nonprofit’s status, you can check it on the Internal Revenue Service (IRS) website using the Tax Exempt Organization Search Tool.

Churches are also considered a qualified organization and usually don’t need to be checked against the IRS’ search tool.

GoFundMe and other online platforms that raise money are not considered qualified organizations and any money donated cannot be deducted as a Charitable Contribution.

Noncash Donations

Charitable Contributions are not limited to cash donatio

ns if you itemize. You can also give property and get a donation, such as clothing to Goodwill or supplies to a pet rescue. In most cases, you value the property donated yourself.  The value should be determined based on what someone would pay for the used property at a consignment shop or thrift store.

If your total noncash donations are more than $500, then you are required to complete and file Form 8283 with your tax return. If you give more than $5,000 per item (or group of similar items), then you must get a qualified appraisal for the item (or group) and fill out Section B of Form 8283. If you claim more than $500,000 then the qualified appraisal must be attached to your tax return when you file.

Special rules apply to donations of certain property, such as automobiles and inventory.

Did you receive any benefit from the donation?

If you received any type of benefit from the donation you made, then you must reduce your charitable contribution deduction by the value of the benefit. Common benefits with donations are merchandise (t-shirts), banquets, sporting events, and performances. The value of the benefit is typically provided by the qualified organization.

Limits & Floor

There are limits and phaseouts to almost every tax deduction and credit, including Charitable Contributions. Cash contributions are limited to 60% of your Adjusted Gross Income (AGI). Noncash contributions are typically limited to 50% of your AGI, minus cash contributions. Other limits may also apply.

The One Big Beautiful Bill Act also imposed a floor based on .5% of AGI that starts with tax year 2026. This means that only the portion of total charitable contributions that exceed .5% of your AGI is deductible. Any portion of a contribution that is disallowed due to the .5% floor can be carried forward, provided you have sufficient charitable contribution carryforwards.

Records to Keep

You must keep records of all charitable contributions that you take as a tax deduction. For monetary contributions of any amount, you should keep a bank record (cancelled check, statement) or written communication from the qualified organization that contains the name of the organization, the amount, and the date of contribution. For donations over $250, you are required to obtain and keep a contemporaneous written acknowledgment from the qualified organization. This written acknowledgment should include the amount donated, a description of any property other than cash contributed, and whether any goods or services were provided in exchange for the donation. If any goods or services were provided by the organization then the acknowledgment should also include a good faith estimate of the value.

As with any tax deduction or credit, be sure to consult with your tax professional.