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Charitable Contribution Tax Deduction Extended

Usually, donations to non-profit organizations can only be deducted if an individual or couple itemizes their tax deductions. In 2020, the IRS waived this requirement and allowed a certain amount of charitable contributions to be deducted for those who take the standard deduction.  The IRS has extended this option for the 2021 income tax year.  While we know few people make such contributions only for the potential tax benefit, we are always glad to see generous people receive a reward for their giving.

Here are the details:

Who Qualifies?

Individuals or married couples who file a 2021 tax return.

What Contributions Count?

Donations made to IRS recognized charitable organizations such as a 501©3 or 501(b).

What is the Maximum Deduction Allowed?

$300 for an individual or $600 for a married couple

Do You Need to Itemize to Benefit?

No. This so-called “above the line” deduction is available to those who take the standard deduction.

Are receipts needed?

Donation receipts, copies of cancelled checks or acknowledgement letters from the charity can be used as documentation.

 As always, ask your tax preparer about your specific situation for guidance.