Tax–and Other–Benefits of Donating to Legacies
June 14, 2021
You can save money on your taxes by donating property to Legacies Upscale Resale. Tax-deductible donations are contributions of money or goods to a tax-exempt charitable organization. These donations can substantially cut your taxable income, and at Legacies, they also help people struggling with cancer through Cancer Support Community (CSC).
But for the 2020 tax year, you can deduct up to $300 of cash donations without having to itemize. This is called an “above the line” deduction. In 2021, this deduction is $300 per person (not per tax return). Married couples filing jointly can deduct up to $600 without itemizing.
Deduct up to 60% from your adjusted gross income
Most people can deduct up to 60% of their adjusted gross income for charitable donations (or up to 100% for cash gifts—the CARES Act of 2020 eliminated the 60% limit), but you may be limited by the type of contribution and the organization (contributions to some veterans groups, foundations, fraternities and burial grounds have a lower limit).
The limit applies to all donations you make throughout the year, no matter how many organizations you donate to. Contributions above the limit can often be deducted over the following years through a “carryover.”
Claiming tax-deductible donations
- Log deductions every year. When you file annually, you’ll usually need to itemize your deductions each year to claim tax-deductible donations to charity. That means filling out Schedule A along with your tax return.
- Make sure it is worth it to itemize. Itemizing usually takes more time than taking the standard deduction, and it may require more expensive tax software or involve a higher bill from the person who prepares your taxes. Plus, if your standard deduction is more than the sum of your itemized deductions, it might not be worth it to itemize.
Standard deductions range from $12,550 to $18,800 for 2021, so if you don’t donate goods worth more than that, it will not be worth your time to itemize.
- Get the proper documentation. For cash or property donations worth more than $250, the IRS requires you to get a written letter of acknowledgment from the charity. It must include the amount you donated, whether you received anything in exchange, and an estimate of the value of those goods and services. You must receive the letter of acknowledgement by the date you file your taxes for the year you made the contribution.
Fill out Form 8283 if you’ll deduct at least $500 in donated items. You must attach an appraisal of your items if they’re worth more than $5,000.
You can also take a tax deduction for volunteering at Legacies
You can’t deduct the value of your time or service, but expenses related to volunteering for an organization like Legacies can be tax deductible donations. Personal, living or family expenses do not count, but you can deduct mileage—deducting your actual expense for gas, etc. using receipts, or taking the standard charitable work mileage deduction, which is $0.14 per mile for 2021.
Keep receipts if you plan to deduct actual expenses. You may need them if you’re audited.
An even greater benefit: supporting Cancer Support Community
All proceeds from Legacies Upscale Resale benefit CSC, which provides free support services to cancer patients and their families. Your donations and consignments help fund over 200 monthly programs at CSC.
CSC complements conventional medical care, enhances quality of life, strengthens survivor care, improves recovery, and facilitates communication with medical teams.
*This above information should not be used at tax advice. Please contact your tax professional.