You may deduct charitable contributions if you itemize your income tax deductions on Schedule A (Form 1040). Remember that not all non-profit organizations are tax-exempt charity organizations. Check with the IRS or ask the organization whether your gift is tax-deductible. You should maintain detailed records of all gifts. Remember that you may deduct cash and property gifts, but not the value of contributed time and services.
If you make a charitable contribution and get anything in exchange, such as dinner, your charitable deduction is the amount you paid or the value of the property you provided less the value of the goods or services received. However, you are not required to decrease your deduction if you get a tiny item or another benefit of little value that the charity considers insignificant. In such situation, you may deduct your whole contribution.
The charitable donation deduction is normally restricted to 50% of your adjusted gross income (AGI). The deduction for appreciated property is restricted to 30% of your AGI if you choose to deduct the property’s fair market value or 50% if you choose to deduct the property’s base.
