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Question
Are there limits on charitable contribution deductions?
AI accountant’s answer:
Yes, there are limits on charitable contribution deductions. The limits depend on the type of organization you're donating to and your adjusted gross income (AGI). For cash donations to public charities, such as churches, schools, and nonprofit organizations, you can generally deduct up to 60% of your AGI. For tax year 2021, this limit was temporarily increased to 100% of AGI as part of COVID-19 relief measures, but it has returned to 60% for tax year 2022. For non-cash donations to public charities, like donating property or stocks, the deduction limit is generally 30% of your AGI. When you donate to nonoperating private foundations, veterans' organizations, fraternal societies, or cemetery organizations, the deduction limit is generally 30% of your AGI for cash donations and 20% of your AGI for non-cash donations. If your donations exceed these limits, you can carry over the excess contributions and deduct them for up to five future years, subject to the same percentage limitations. Keep in mind that to claim any charitable contribution deduction, you must itemize your deductions on Schedule A of your Form 1040 tax return instead of taking the standard deduction.
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