Charitable Contribution Tax Deduction Limits

Below are expanded definition of each level of charitable contribution tax deduction limit. We already discussed that there are 50% deduction level, 30% tax deduction level and 20%.

About the 50% charitable contribution tax deductions

Generally the 50% limit is the only limit that applies to gifts to organizations listed below under 50% limit organization. But there is one exception. A 30% limit also applies to these gifts if they are gifts of capital gain property for which your future your deduction using fair market value without reduction for appreciation.

Which charitable organizations are 50% tax deductible organizations?

you can ask any organization whether it is s a 50% limit organization and most will be able to tell you. Or you can check IRS Tax publication 78 or call the IRS tax exempt/government entities customer service.

The following is a partial list of the types of organizations that are 50% limit organizations.

• churches and conventions or associations of churches
• educational organizations with a regular faculty and curriculum that normally have a regularly enrolled student body attending classes on site.
• hospitals and certain medical research or canonizations associated with these hospitals
• publicly supported charities
• private operating foundations
• private non operating foundations that make qualifying distributions of 100%  of contributions within 2 1/2 months following the year they receive the contributions
• certain private foundations whose contributions are pooled in a common fund, the income and principal of which are paid to public charities

Special 30% tax deduction limit for capital gain property

A special 30% limit on tax deduction applied to gifts of capital gain property to 50%  limit organizations for gifts of capital gin property to other organizations. However the special 30% limit does not apply when you choose to reduce the fair market value of the property by the amount that would have been long term capital gain if you had sold the property. Instead only the 50% limit applies.

Two separate 30% limits.

This special 30% limit on tax deduction for capital gain property is separate from the other 30% limit. Therefore the deduction of the contribution subject to one 30% limit does not reduce the amount you can deduct for contributions subject to the other 30% limit. However, the total you deduct cannot be more than 50% of your AGI.