Do not miss the new deduction for non-itemizers on 2020 returns. Also, be careful of the existing requirements to receive proper acknowledgement letters from charities that you have donated > $250 throughout the year, before you file your return. Even if you receive the letter before the due date of the return, it is too late if you filed before receiving the letter!

New deduction for non-itemizers

If you do not itemize deductions, but instead claim the standard deduction, you can now claim a federal tax write-off for up to $300 of cash contributions to IRS-approved charities for the 2020 tax year. No matter what your filing status is, including married filing jointly, the deduction on your return will be limited to $300 for 2020. However, the Consolidated Appropriations Act just recently passed, doubles the deduction limit to $600 for married joint-filing couples in 2021.

Acknowledgement letters

The IRS has strict substantiation requirements and wins these very easily in court if you do not have proper and timely documents. You must receive the acknowledgement letters prior to filing your return, even if you are filing before the due date of the return. The charity must state the amount of the donation, whether you received any goods or services in consideration for the donation and the value of any such goods or services.

If you made accumulated donations of under $250 to a charity during the year, a canceled check, bank statement or credit card statement is sufficient evidence.