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linkerc
Returning Member

IRS limitation to itemized deduction

I made a large charitable cache donation for tax year 2020.  Turbotax allows up to my adjusted gross income to be deducted.  As the result, my TT shows $0 for form 1040 line 15 (taxable income).  But I got an IRS notice cp12.  The conclusion is that line 15 shouldn't be zero because there's a limitation on how much I can deduct.

Is TT wrong?  The amount of my donation is more than my earning; therefore, I was anticipating carry over deduction to next year.  Now the IRS said I can't deduct as much as TT allows me to.  Should I change my TT for year 2020 so next year's carry over will be correct?

 

Any help will be appreciated.

2 Replies
Mike9241
Level 15

IRS limitation to itemized deduction

what exactly was the charitable "cache" donation?  there are many limitations on the amount that can be deducted even cash. 

rather than me list all the various limitations I point you to IRS publication 526 

https://www.irs.gov/pub/irs-pdf/p526.pdf 

the rules on the limits start on page 14.

it is possible the IRS made a mistake but we have no way of knowing because we can't see the details of your contributions. if the IRS is correct then it is likely something was not entered correctly in Turbotax for one or more of your contributions.

if you conclude your return was correct - ie an IRS or Turbotax error ten you can contact

The Audit Defense service provided by TaxResources, Inc., also called TaxAudit.com. If you paid for Audit Defense and you received an IRS notice, call them at 877-829-9695, or report your IRS notice on their website at http://intuit.taxaudit.com/. Do not contact the IRS until you have spoken to TaxResources. They may contact the IRS on your behalf.

 

 

 

linkerc
Returning Member

IRS limitation to itemized deduction

Sorry, it was a typo.  Cash donation.

It was to a religious organization.

 

The form cp12 states:

"We believe there's a miscalculation on your 2020 form 1040, which affects the following

* itemized Deductions"

 

And the back of the notice states:

 

"Changes to your 2020 tax return:

Information was changed because of the following:

* We changed the amount claimed as total gifts to charity on your Schedule A, Itemized Deductions, because it was figured incorrectly or the amount was not limited based on your adjusted gross income. (180D)"

 

So it there seems to be a limit on how much I can deduct based on my AGI.

Anyway, I will check with the tax audit team first.

 

Thanks.

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