topic What is the AGI deduction for charitable giving in Deductions & credits

What is the AGI deduction for charitable giving

kaplan9333 — Sun, 22 Nov 2020 21:04:45 GMT

Should I gift stock in 2020 or sell the stock and gift cash

Re: What is the AGI deduction for charitable giving

Critter-3 — Sun, 22 Nov 2020 22:34:05 GMT

If you gift appreciated stock you get the benefit of donating it at the current value ... but if you sell the stock you must pay the taxes on the capital gains before you make the donation deduction.

Re: What is the AGI deduction for charitable giving

Opus 17 — Mon, 23 Nov 2020 21:55:08 GMT

For gifts of appreciated stock, the limit you can deduct in one year is 30% of your AGI for most charities, and 20% of your AGI for some charities. While the CARES act temporarily increased the overall limit for "50% charities" to 100% of your AGI, the CARES act did not change the 30% limit for gifts of appreciated stock to 50% charities.

I guess that means that you can sell the stock and pay capital gains tax, and then donated the cash up to the 100% limit, or donate the appreciated stock and, if the stock value is more than 30% of your AGI, carry the deduction forward to next year. I can't think of a reason why it would be better to pay the tax for the larger deduction this year instead of donating the stock even if you have to carry part of the donation forward. You may want to see a financial planner.

Re: What is the AGI deduction for charitable giving

Hal_Al — Tue, 24 Nov 2020 01:04:25 GMT

For 2020 only, under the CARES (Covid) act, you make deduct up to $300, even if you do not itemize deductions. However, the $300 is applicable to cash donations only; no stocks or donations of personal items, like clothes or household items.

Reference: https://www.cnbc.com/2020/11/23/cares-act-added-a-300-charitable-contribution-deduction-heres-how-it-works.html#:~:text=The%20CARES%20Act%20added%20a%20new%20%24300%20charitable%20contribution%20deduction%20for%202020.&text=You%20can%20write%20off%20up,when%20you%20file%20your%20taxes.

Re: What is the AGI deduction for charitable giving

Carl — Tue, 24 Nov 2020 13:33:51 GMT

Charitable contributions (that qualify as such) in any form do not reduce your AGI. They are an itemized deduction on SCH A.

Re: What is the AGI deduction for charitable giving

Hal_Al — Tue, 24 Nov 2020 14:15:32 GMT

For 2020, the (up to) $300 charitable cash deduction goes on line 10b of form 1040 and is an adjustment to income, reducing taxpayer's AGI.

Re: What is the AGI deduction for charitable giving

Carl — Tue, 24 Nov 2020 16:35:07 GMT

Thanks. I see that now. Was looking at the 2019 1040 before. This is probably apply to a majority of people for 2020, as I would expect most will not itemize anyway.