Yes, it is allowable if you itemized and in 2017 it was calculated as a disallowed and carryforward contribution and has not yet been used in years 2018-2020 and should be getting carried forward if you used TurboTax for all of these consecutive years. Per IRS, a current year disallowed charitable contribution can be carried forward for up to 5 tax years. If you did not use TurboTax for all consecutive years, you will need to enter this information yourself.
In other words, and with some examples for you, here are a couple of scenarios, along with a link to additional information due to the Cares Act and its effect on Charitable Contributions:
There may a time when your charitable contributions made in a tax year exceed the amount that you can deduct on Schedule A of your Form 1040 for the year. The deduction for most charitable contributions is limited to 60% of your adjusted gross income (AGI). Note: there are some other percentages that can come into play if the item given away is capital gain property or the contribution is not made to a public charity – we are not covering that here.
So, what happens if your income for a year suddenly drops and you have already given away more than 60%? Do you lose the benefit of the tax deduction? The answer to that is an absolute NO! The contributions can be carried over for five years. However, and this is a big however, the carryover contributions cannot be considered until any contributions from the current year have been considered.
Here is an example:
Pretend you have contributions that you could not use in 2018 and are carrying them over in the amount of $24,000. You also just contributed in 2019 to your favorite charity in the amount of $24,000. That is $48,000 total available that you may be able to deduct on your 2019 Schedule A, subject to the 60% AGI limitation. If your 2019 AGI is $40,000, then the allowable amount of charitable contributions would be $24,000 (60% of your 2019 $40,000 AGI). But not the $24,000 from 2018 – the $24,000 from 2019. That leaves just four more years on your 2018 charitable carryover before you lose it.
Alternatively, pretend your 2019 AGI is $60,000 – the allowable amount of your charitable contribution would be $36,000 (60% of the $60,000 AGI), which would consist of the $24,000 from 2019 and $12,000 of your carryover from 2018, leaving you with a $12,000 charitable carryover to 2020 from 2018 and none from 2019.
How the Recent Cares Act Affects Charitable Contributions
