Deductions: Charitable Gifts

A charitable gift is a contribution of cash or property to, or for the use of, a qualified charity. A gift is "for the use of" an organization when it's held in a legally enforceable trust for the qualified organization or in a similar legal arrangement. Americans give billions of dollars to charities each year, partly because charitable donations are tax deductible. To receive a tax deduction for your gift, you must itemize your deductions and make the gift to a qualified organization, not to a specific person. For example, a gift that's for the benefit of an individual flood victim isn't deductible, but a gift to a qualified organization that helps flood victims generally is deductible.

Tip:  Persons aged 70½ and older can exclude from their gross income qualified charitable distributions of up to $100,000 a year from a traditional IRA or a Roth IRA. Distributions must be made directly from the IRA to the charity, and all the usual requirements for charitable deductions must be met.

Tip: To deduct a charitable contribution, you must file Form 1040 and itemize deductions on Schedule A.

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