How Tax Deductible Donations Work (And 3 Things To Keep In Mind)

A simple guide to tax deductible donations

December 16, 2022

Donating to charity is a great way to support causes you care about. It's also a way to receive tax deduction savings, because the Internal Revenue Service (IRS) allows taxpayers to deduct charitable donations from their taxes.

Reading this guide will help you understand everything you need to know about charitable contributions as tax deductions. (*Please note, this guide is intended for people living in the United States).

What are tax deductible donations?

Tax deductible donations are contributions of money or goods to a tax-exempt organization such as a charity. As long as you don’t benefit financially or otherwise from the donation, you may be eligible to claim it as a tax deduction.

What’s the benefit?

Simply put, tax deductible donations can reduce your tax bill and taxable income, while also supporting a worthy cause. 

How does it work

  1. You donate to a qualified charity or organization.
  2. After making the donation, the charity gives you a receipt. 
  3. Using this receipt, you can either deduct the charitable contributions as itemized deductions on Schedule A, Form 1040 or take a standard deduction. Both qualify as a deduction.

3 things to keep in mind when making tax deductible donations

  1. You must donate to a qualifying organization

There is a wide range of organizations you can donate to, but not all of them qualify for tax deductions. You can verify if an organization is qualified with the IRS Exempt Organizations Search tool. DonorSee and most of our partners on the platform qualify. You can give directly to 100% tax deductible projects here.

  1. How much you can deduct depends on your gross income

In most cases, the amount of charitable cash contributions taxpayers can deduct is limited to a percentage (usually 60 percent) of the taxpayer’s gross income. Although the IRS made an exception to this for 2021 taxes.

  1. Keep your receipts as proof

The IRS requires proof for all charitable contributions. Without proof, you can only include cash donations less than $300, and you need to provide your bank record or record of the payroll deduction. You will need a receipt for any donation of more than $300 or a donation other than cash.

Luckily, DonorSee automatically issues you with a tax receipt, which is emailed to you when you give.

Looking for a simple way to make a tax deductible donation? 

At DonorSee, we make giving simple, transparent and joyful. All donations on our end-of-year page are 100% tax-deductible so you can reduce your tax bill, while also supporting worthy causes https://bit.ly/3iFAmCT

  • All of our projects are vetted
  • Donations are securely processed by Stripe
  • You will receive an automatic tax receipt 
  • AND, you will receive a video update showing you exactly how your money was used and the joy you created.