$300 “Above the Line” Charitable Deductions for Nonitemizers

$300 "Above the Line" Charitable Deductions for Nonitemizers

Coronavirus Aid, Relief, and Economic Security (CARES) Act also includes eligible individuals who do not itemize deductions to deduct $300 of qualified charitable contributions as an “above the line” deduction. This deduction applies to tax years beginning in 2020 and the $300 limit is per filing unit regardless of filing status.

For Qualified deduction they must be:

  • In cash, check, electronic funds, or payroll deductions (no property i.e. old clothing, furniture, or household items)
  • Given to a 501(c)(3) public charity

There are no requirements for documentation with the tax return. However, the IRS requires written record of all cash contributions over $250, it can be reasonably inferred that the requirements will apply in the same way for this deduction.

With the Tax Cuts and Jobs Act (TCJA) the standard deduction roughly doubled and has limited the benefit of itemized deductions. For 2020, the standard deduction for single taxpayers is $12,400 and for married filing jointly is $24,800. Now that the CARES Act is allowing the $300 above-the-line charitable contribution deduction per filing unit, although relatively small, this will help reduce taxable income for those who are unable to itemize deduct on their personal tax return.