This Year, Keep Those Donation Receipts
Hi Friendos,
This condo treasurer spent a big chunk of her day working on financial analysis for her building, so today you are getting a quick tax tip about a change in tax law for charitable giving.
In a prior newsletter, I said it is (effectively) a myth that charitable donations are tax-deductible (except for the super-rich). That is because the vast majority of people take the standard deduction when they file their tax returns; they do not itemize. I gave a detailed explanation of these mechanics in this newsletter. Well, effective this year there is a new “above-the-line” deduction for charitable giving, up to $1,000, available to taxpayers who itemize. As the IRS states:
“Beginning with tax year 2026, if you do not itemize, you may deduct up to $1,000 ($2,000 if filing jointly) of your cash contributions to certain qualified organizations.”
So perhaps in the past you never bothered to save gift acknowledgement letters. This year, it’s worth hanging on to those backup docs in case you are audited. If you gave $1,000 (or more), and your marginal tax rate is 22%, the deduction reduces your taxable income by $1,000, saving you $220 in tax.
Give from the heart and save those receipts!
-Stephanie
