charitable donations

[gemlkb]

are charitable donations deducted dollar for dollar off adjusted gross income if you itemize?

[xmasbaby0]

No.

A charitable donation almost never changes your tax due or refund all by itself.  First, your donation does not count "dollar for dollar"--it is calculated by a percentage based on your tax bracket.  You need a LOT of other itemized deductions like mortgage interest or property taxes, medical expense, etc. to itemize and exceed your standard deduction.

STANDARD DEDUCTION

Many taxpayers are surprised because their itemized deductions are not having the same effect as they did on past tax returns.  The new higher standard deduction and the elimination of certain deductions, as well as the cap on state and local taxes have had a major impact since the new tax laws went into effect beginning with 2018 returns.

Your itemized deductions have to be more than your standard deduction before you will see a change in your tax owed or tax refund.  The deductions you enter do not necessarily count “dollar for dollar;” many of them are subject to meeting  tough thresholds—medical expenses, for example, must meet a threshold that is pretty hard to reach. (Only the amount that is MORE than 7.5% of your AGI counts)   The software program uses all the IRS rules that apply to the expenses you enter, and it tells you if you have enough to use your itemized deductions or if using the standard deduction is more advantageous for you.  Under the new tax laws, some deductions have been capped—there is a $10,000 limit to the itemized deductions for state, local, property and sales taxes.

Your standard deduction lowers your taxable income.  It is not a refund.  You will see your standard or itemized deduction amount on line 12a of your 2021 Form 1040.

2022 STANDARD DEDUCTION AMOUNTS

SINGLE $12,950  (65 or older + $1750)

MARRIED FILING SEPARATELY $12,950  (65 or older + $1750)

MARRIED FILING JOINTLY $25,900  (65 or older + $1400 per spouse)

HEAD OF HOUSEHOLD  $19,400  (65 or older +$1750)

Legally Blind + $1750

And.....the $300 "above the line" charity donation deduction ($600 for a couple filing jointly) is gone for 2022.

[KarenL4]

Hi, 

You asked: are charitable donations deducted dollar for dollar off adjusted gross income if you itemize?

As with many tax-related items, the answer is, it's complicated.  There are limitations on what you can deduct based upon the type of property (cash, art, etc.) you are donating and some other factors.  This TurboTax article gives you a great place to get started at understanding the rules.  If you are looking for a deeper dive, here is the relevant IRS publication. If you want to post again with a more detailed question, we can help more! 

Please cheer if you find this answer helpful!

[KarenL4]

Great answer on deductions and how they impact taxes from XMASBABY!  I was focusing on the charitable piece, but that insight is also very valuable!