Your one chance to truly give to the Milwaukee Makerspace.

[Kathryn Hughett]

This will probably be the only year that you can do this for the Milwaukee Makerspace. 

100% of cash contributions, up to $300 per person can be deducted from your 2021 taxes even if you don't itemize. 

A husband and wife can donate up to $600 to the Milwaukee Makerspace and get a full refund for their donation. 

https://www.irs.gov/newsroom/expanded-tax-benefits-help-individuals-and-businesses-give-to-charity-in-2021

Pandemic Special: even if you don’t itemize you can deduct up to $300 in cash contributions to charity.

Expanded tax benefits help individuals and businesses give to charity in 2021

Recent legislation includes several provisions to help individuals and businesses who give to charity. The new law generally extends four temporary tax changes through the end of 2021. Here’s an overview of these changes.

Deduction for individuals who don't itemize 

Usually taxpayers who take the standard deduction cannot deduct their charitable contributions. The law now permits taxpayers to claim a limited deduction on their 2021 federal income tax returns for cash contributions they made to certain qualifying charitable organizations. 

These taxpayers, including married individuals filing separate returns, can claim a deduction of up to $300 for cash contributions to qualifying charities during 2021. The maximum deduction is $600 for married individuals filing joint returns.

Cash donations

Most cash donations made to charity qualify for the deduction. However, there are some exceptions. Cash contributions that are not tax deductible include those:

Made to a supporting organization

Intended to help establish or maintain a donor advised fund

Carried forward from prior years

Made to most private foundations

Made to charitable remainder trusts

These exceptions also apply to taxpayers who itemize their deductions.

Cash contributions include those made by check, credit card or debit card as well as unreimbursed out-of-pocket expenses in connection with volunteer services to a qualifying charitable organization. Cash contributions don't include the value of volunteer services, securities, household items or other property.

100% limit on eligible cash contributions made by taxpayers who itemize deductions in 2021

Taxpayers who itemize can generally claim a deduction for charitable contributions to qualifying organizations. The deduction is typically limited to 20% to 60% of their adjusted gross income and varies depending on the type of contribution and the type of charity. 

The law now allows taxpayers to apply up to 100% of their AGI, for calendar-year 2021 qualified contributions. Qualified contributions are cash contributions to qualifying charitable organizations.

The 100% limit is not automatic; the taxpayer must choose to take the new limit for any qualified cash contribution. Otherwise, the usual limit applies. The taxpayer’s other allowed charitable contribution deductions reduce the maximum amount allowed under this election. Eligible individuals must make their elections on their 2021 Form 1040 or Form 1040-SR.

Corporate limit increased to 25% of taxable income

The law now permits C corporations to apply an increased corporate limit of 25% of taxable income for charitable cash contributions made to eligible charities during calendar year 2021. The increased limit is not automatic. C corporations must the choose the increased corporate limit on a contribution-by-contribution basis.

Increased limits on amounts deductible by businesses for certain donated food inventory

Businesses donating food inventory that are eligible for the existing enhanced deduction may qualify for increased deduction limits. For contributions made in 2021, the limit is increased to 25%. For C corporations, the 25% limit is based on their taxable income. For other businesses, including sole proprietorships, partnerships, and S corporations, the limit is based on their total net income for the year. A special method for computing the enhanced deduction continues to apply, as do food quality standards and other requirements.

Share this tip on social media -- #IRSTaxTip: Expanded tax benefits help individuals and businesses give to charity in 2021. 

[Dan Jonke]

Good to know Kathy!

 

FYI,

 

Your dues are not considered deductible, because you receive a benefit from MMS. Anything you give in addition to that, is considered deductible if you don't receive a benefit from it:

 

https://www.irs.gov/publications/p526#en_US_2020_publink1000229696

 

So if you've put money in the soda fund, you don't get to deduct that*, because you got a soda that other people did not get. But if you contributed to a group buy for a tool that everyone can use equally, you get to deduct that money.

 

Thanks!

Dan

 

*If you are drinking enough soda that you even need to consider tax optimization of that spending, please stop and give your pancreas a fighting chance! :-P

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[Kathryn Hughett]

I'm bumping this up because we're getting close to tax season. It may be possible to designate your donation to a particular area. Please check with our treasurer, Jeff Mann. 

To view this discussion on the web visit https://groups.google.com/d/msgid/membersonly-milwaukeemakerspace/93C704D01218497EBD59690BEC32EA73%40DanPC.