Archive for May, 2010
Charitable Tax Deductions
May 1st, 2010
Question: how do charitable Tax Deductions work?
Ok so if my husband is making past the 100k annual bracket. We are obviously getting taxed tens of thousands. So theoretically speaking, lets say I get taxed $28,000 this year. If I donated $20,000 to charity (non profit) will my tax “deduction” lower my annual tax to just $8,000…. or does it work in a differe way
omgosh please help!!!
Answer: No, the deduction would reduce your taxable income by $20,000. The value of that depends upon your tax bracket and any other Itemized Deductions that you have. You’re in a 25% tax bracket with a standard deduction of $10,700 so if it was your ONLY itemized deduction then it would reduce your tax by $2,325.00 — .25*(20,000-10,700). If you already had at least $10,700 in itemized deductions it would reduce your tax by $5,000.
Items on Amazon Right Now for Charitable Tax Deductions:
High-income taxpayer alert: 2010 is year to give
The Tax Foundation warns that restrictions on itemized deductions return next year – so high-income taxpayers mulling major charitable giving should act this year. “The federal individual income tax has, since its inception, allowed for …
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