Under current law, an individual who itemizes can deduct charitable contributions up to 50%, 30%, or 20% of their adjusted gross income (AGI) depending on the type of property donated and the type of recipient (donee). Corporations can only deduct contributions up to 10% of their taxable income. Any excess contributions above these amounts get carried over to the future for five years subject to some limitations. For individuals, you must be itemizing your deductions in order to get any charitable contribution deduction.
Finally, any excess contributions can be carried over to the future for five years.
New law: The new law temporarily changes much of this for contributions made before December 31, 2017 to qualified charities for Hurricane relief.
First, it temporarily suspends the majority of these limitations on charitable contributions that I noted above. Thus, you may be able to contribute to qualified hurricane charities without having to worry about these limits.
Secondly, there are eased rules governing the treatment of excess contributions.
I just gave an overview of the new law in these posts. Please see your tax professional about any of this before making any contributions or implementing any of the strategies (such as borrowing from your pension, etc…).
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