Are charities gonna feel a cut in giving?
One huge change this year is in the tax code. The Trump tax cuts increased the standard deduction and therefore make it less likely that you’ll be able to deduct your charitable donations. Only about 11% of households are likely to itemize their taxes this year, down from 26.4% last year.
The big picture: The tax break for charitable contributions has always been a tax break only for the minority of Americans who itemize. Households earning more than $1 million per year nearly always itemize. They accounted for 30% of itemized charitable donations in 2015; expect that number to rise even further.
In general, you can only deduct your Schedule A deductions to the extent that they exceed 2% of your AGI (7.5% for medical deductions).
Unlike what the article says, you are not prevented from deducting charitable contributions if your income is lower; it’s just far more likely that the value of itemized deductions on Schedule A will be less than the value of taking the standard deduction. Both the IRS and private tax advisors recommend that if the hassle of itemizing and documenting your deductions is not too great, you might want to compare that with the standard deduction that you are entitled to (based on age, disability and household status) and then use the method that yields the greater benefit. Tax-preparation computer programs like TaxPro and Quicken do this semi-automatically.
I think the main point was if you have your accountant or u do the tax return for yourself both ways?
The charitable giving becomes LESS of a incentive to lower ur taxes which is exactly what the Republicans wanted....
Less money to non-profits that tend to NOT be on the GOPer’s side of the fence….
At least THAT IS what I see as an aim on this….
Of course those who have HIGH incomes and TONS and TONS of intimated deductions are NOT effected by the higher standard deduction at ALL…..
And we KNOW they pay a startling LOWER percentage of their income to the government that middle class workers, eh?