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yujoshb
New Member

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

 
7 Replies
Critter-3
Level 15

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

Yes but it would be better if the church put out a statement.

yujoshb
New Member

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

Hey, thanks for replying. In the best case, I know I should ask to see if they give a statement.
However, I wanted to check whether or not a direct deposit was enough proof that was not lacking in the case that no statement is available for me to receive.

Mike9241
Level 15

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

this is what code section 170(f)(8) says

(8)Substantiation requirement for certain contributions
(A)General rule
No deduction shall be allowed under subsection (a) for any contribution of $250 or more unless the taxpayer substantiates the contribution by a contemporaneous written acknowledgment of the contribution by the donee organization that meets the requirements of subparagraph (B).

(B)Content of acknowledgement
An acknowledgement meets the requirements of this subparagraph if it includes the following information:
(i)The amount of cash and a description (but not value) of any property other than cash contributed.
(ii)Whether the donee organization provided any goods or services in consideration, in whole or in part, for any property described in clause (i).

 

 

i don't understand what you mean by this 

"a bank direct deposit enough proof to qualify for tax deduction" 

but that does not sound like a contemporaneous written acknowledgment of the contribution by the donee organization

 

in addition, to be of any benefit you need to be able to itemize your deductions though there is a small charitable deduction allowed if you use the standard deduction but you still must meet the substantiation requirement.

 

 

standard deduction 2021 and 2022

Single; Married Filing Separately $12,550 $12,950
Married Filing Jointly & Surviving Spouses $25,100 $25,900
Head of Household $18,800 $19,400

additional for blind or over 65 per person 2021 and 2022

Married Filing Jointly or Married Filing Separately
• 65 or older OR blind $1,350 $1,400

• 65 or older AND blind double above 

Single or Head of Household
• 65 or older OR blind $1,700 $1,750
• 65 or older AND blind double above

 

 

Hal_Al
Level 15

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

yujoshb
New Member

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

Thank you guys for answering. Based on everything I've read,

1. For any cash donations above $250, a direct deposit is not substantial. I'll look to see if I can get a statement from the church
2. For any cash donations under $250, it seems like a bank record is enough. So does that mean that if I donate $249 twelve times a year respectively for each month per transaction, a direct deposit to the registered church's account is substantial for the tax deduction? Or is $250 referring to the total donated within a year?

Opus 17
Level 15

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?


@yujoshb wrote:

Thank you guys for answering. Based on everything I've read,

1. For any cash donations above $250, a direct deposit is not substantial. I'll look to see if I can get a statement from the church
2. For any cash donations under $250, it seems like a bank record is enough. So does that mean that if I donate $249 twelve times a year respectively for each month per transaction, a direct deposit to the registered church's account is substantial for the tax deduction? Or is $250 referring to the total donated within a year?


The church (or any organization) that receives more than $75 is required to give you a statement acknowledging receipt of the money and stating whether you received any benefit (other than intangible benefits of membership) for the donation.  This can be a single combined year-end statement.  If your church does not issue statements as required by law, I would stop giving them money until they get their finances in order. (I say this as a former church treasurer.  If they can't be bothered to do a simple year-end statement, there's no telling what other funny business they are up to.)

 

The reason for this is that, if you make a large gift, the IRS wants confirmation that it was a no-strings gift and not some other kind of payment.  For example, if you paid $300 to attend a fundraising dinner for a charity, and the fair value of the dinner was $100, you could only claim $200 as the value of the donation.

 

The IRS does not require separate substantiation for gifts of $250 or less.  For this rule, you consider each gift individually, you don't have to aggregate them.

See here for more.

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

 

However, I have a concern.  Suppose you made 10 gifts of $250 each, instead of 8 gifts of $300, to stay under the "more than $250" rule. There are some times when the IRS can accuse you of wrongdoing when you follow the letter of one rule to avoid following a different rule. This is fairly rare, and I'm not saying that will happen here, but it would be better to simply make your gifts as convenient to you and get the statement from the church treasurer.  

*Answers are correct to the best of my ability at the time of posting but do not constitute legal or tax advice.*
yujoshb
New Member

If I tithe to my church a monthly recurring amount of over $300 as a charity donation, is a bank direct deposit enough proof to qualify for tax deduction?

This is excellent advise. Thank you so much for answering this to such degree!

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