Can I Still Deduct Charitable Contributions for Taxes?

Nothing feels better than helping others, so much so that many people willingly give their money to organizations and people that are needy. To both incentivize and reward people for doing so, the government decided that it would give a tax break for doing so many, many years ago.

Many people make use of this tax break every year by itemizing their deductions on Schedule A of their personal tax return. We often get letters and questions regarding whether someone can still take their charitable contributions on their tax return after 2017’s tax overhaul.

The simple answer is yes, you can still deduct your charitable contributions against your income for a tax benefit. Whether doing so is beneficial for the average lower-to-middle class couple is a little tougher to pinpoint. 

The question for most people now is not whether they can take their deductions, but whether they should. You see, you are allowed to take the higher or your standard deduction or the total of your itemized deductions, which include things like medical expenses, mortgage interest, state and local taxes, and of course, charitable contributions. 

The standard deduction has nearly doubled to $12,000 for a single person and $24,000 for a married couple (these amounts increased in 2019 slightly and will likely continue to increase with inflation every year).

The average person or couple will find it difficult to spend enough to come close to these amounts, choosing to take the simpler standard deduction instead of adding up their receipts for charity and medical expenses.

In doing so, life is much simpler for the average person come tax time. However, it should be noted that charities were afraid that this would negatively affect giving and have strongly lobbied against this change in our tax code.

In most studies since the tax changes, data have shown that Americans are giving significantly less than previous years, indicating that the deductibility of charitable expenses was a big incentive for the ordinary American.

But what do you think? Would you rather see filing taxes become an easier process for the average American or the charitable contributions to your favorite organizations increase?

Leave a comment below and let us know.

 


Thank you for reading. This article should not constitute legal or tax advice. For help regarding your specific situation, please consult a local advisor.

Author: Foxx Financial

We are focused on financial literacy and a want to help others grow assets, reduce and remove debt, or just understand financial concepts better. The site will be updated often so subscribe for more content.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s