This article generally explains the rules covering income tax deductions for charitable contributions by individuals. You can find a more comprehensive discussion of these rules in Publication 526, Charitable Contributions, and Publication 561, Determining the Value of Donated Property. For information about the substantiation and disclosure requirements for charitable contributions, see Publication 1771. You can obtain these publications free of charge by calling 1-800-829-3676.

You may deduct charitable contributions of money or property made to qualified organizations if you itemize your deductions. Generally, you may deduct up to 50% of your adjusted gross income, but 20% and 30% limitations apply in some cases. Publication 78 uses a coding system to identify these limitations; see Publication 78 Help - Part I for more information.

Qualified Organizations

You may deduct a charitable contribution made to, or for the use of, any of the following organizations that otherwise are qualified under section 170(c) of the Internal Revenue Code:

1. A state or United States possession (or political subdivision thereof), or the United States or the District of Columbia, if made exclusively for public purposes;
2. A community chest, corporation, trust, fund, or foundation, organized or created in the United States or its possessions, or under the laws of the United States, any state, the District of Columbia or any possession of the United States, and organized and operated exclusively for charitable, religious, educational, scientific, or literary purposes, or for the prevention of cruelty to children or animals;
3. A church, synagogue, or other religious organization;
4. A war veterans' organization or its post, auxiliary, trust, or foundation organized in the United States or its possessions;
5. A nonprofit volunteer fire company;
6. A civil defense organization created under federal, state, or local law (this includes unreimbursed expenses of civil defense volunteers that are directly connected with and solely attributable to their volunteer services);
7. A domestic fraternal society , operating under the lodge system, but only if the contribution is to be used exclusively for charitable purposes;
8. A nonprofit cemetery company if the funds are irrevocably dedicated to the perpetual care of the cemetery as a whole and not a particular lot or mausoleum crypt.

Timing of Contributions

Contributions must actually be paid in cash or other property before the close of your tax year to be deductible, whether you use the cash or accrual method.

Deductible Amounts

If you donate property other than cash to a qualified organization, you may generally deduct the fair market value of the property.  If the property has appreciated in value, however, some adjustments may have to be made.

The rules relating to how to determine fair market value are discussed in Publication 561, Determining the Value of Donated Property.

Limitation on Deductions

In general, contributions to charitable organizations may be deducted up to 50% of adjusted gross income computed without regard to net operating loss carrybacks.  Contributions to certain private foundations, veterans organizations, fraternal societies, and cemetery organizations are limited to 30% adjusted gross income (computed without regard to net operating loss carrybacks), however.  Publication 78 uses a coding system to indicate these limitations.

The 50% limitation applies to (1) all public charities (no code), (2) all private operating foundations (code 3), (3) certain private foundations that distribute the contributions they receive to public charities and private operating foundations within 2-1/2 months following the year receipt, and (4) certain private foundations the contributions to which are pooled in a common fund and the income and corpus of which are paid to public charities.

The 30% limitation applies to private foundations (code 4--other than those previously mentioned that qualify for 50%) and to other organizations described in section 170(c) that do not qualify for the 50% limitation (codes 2, 6 and 7).  The other organizations that qualify for the 30% limitation are organizations such as fraternal societies and veterans' organizations.

A special limitation applies to certain gifts of long-term capital gain property.  A discussion of that special limitation may be found in Publication 526, Income Tax Deduction for Contributions.

Foreign Organizations

The organizations listed in this publication with foreign addresses are generally not foreign organizations but are domestically formed organizations carrying on activities in foreign countries.  These organizations are treated the same as any other domestic organization with regard to deductibility limitations.

Certain organizations with Canadian addresses listed may be foreign organizations to which contributions are deductible only because of tax treaty.  For these organizations, in addition to the limitations on the amount of the deduction allowed by section 170 of the Code, the deduction may not exceed the amount allowed as a deduction under Canadian law computed as though the taxable income (in the case of a corporation) or adjusted gross income (in the case of an individual) from sources in Canada is the aggregate income.  A deduction for a contribution to a Canadian organization listed in this publication is unallowable if the contributor reports no taxable income from Canadian sources on the United States income tax return.

Except as indicated above, contributions to a foreign organization are not deductible.

Additional information:

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