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There’s Still Time to Get a Tax Break for Donations to Charity

  • Taxes
  • December 30, 2021

You still have time to contribute to a charitable cause and get a break on your 2021 tax return, even if you don’t itemize deductions.

A special tax break available to most taxpayers, approved by Congress for the 2020 tax year as part of the pandemic relief program, was extended through 2021.

That means individual taxpayers can take a deduction of up to $300 for cash donations made this year when they file their federal tax returns in 2022. Married couples who file joint tax returns can take a deduction of up to $600, instead of being restricted to $300 as they were last year, according to the Internal Revenue Service.

Deductions lower your taxable income, helping to reduce the amount of federal income tax you pay.

Normally, taxpayers can’t deduct charitable contributions unless they itemize — meaning they report each separate deduction on their return and deduct the total. It generally doesn’t make sense to itemize, unless your deductions exceed the “standard” one set by the Internal Revenue Service. That’s the amount you can deduct from your income, with no documentation required.

Most taxpayers now take the standard deduction because it was roughly doubled as a result of the tax code overhaul in 2017. (The standard deduction for the 2021 tax year is $12,550 for a single taxpayer and $25,100 for a married couple filing a joint return.) About 90 percent of filers now take the standard deduction and are probably eligible for the special deduction for charitable giving, according to the Internal Revenue Service.

To qualify for the extra deduction, the donations must be made to an eligible charity and must be paid in cash, check or credit card. Donating goods or volunteering your time doesn’t count.

The specific dollar amount that you will save with the deduction depends on your tax rate, said Susan Allen, a senior manager for tax practice and ethics with the American Institute of Certified Public Accountants.

Because the amount you can deduct is low, the tax savings may be relatively modest. For instance, a single person in the 22 percent tax bracket who makes a $300 donation could save about $66, Ms. Allen said.

If you are married, file a joint tax return, and are in the 22 percent bracket, you could save about $132.

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