Let's say your only itemized deduction is a $5,000 donation to a qualified charity. If you took that instead of the standard deduction, you'd get taxed on $95,000 of income.
However, the CARES Act created a temporary provision that’s still in place for 2021. It’s set to expire after this year.
You must make the donation in dollars (as opposed to donating items, property or stock). And you need to get a receipt.
But if you do that, you can take your standard deduction and get up to $300 ($600 if filing jointly) off your taxable income.
In other words, if you haven’t done so already, you have until Dec. 31 to contribute to a charity and reduce your 2021 tax bill.
Money expert Clark Howard recently discussed how to find the best charity for you to donate to. If you're interested in doing good while also getting a tax benefit, check out this article.
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