What To Know About Claiming Charity Tax Deductions When Filing 2025 Taxes

As you gather your documents to file your 2024 taxes in 2025, understanding the rules around charitable contributions is essential for maximizing your potential deductions. The Internal Revenue Service (IRS) provides specific guidelines that taxpayers must follow to claim a deduction for the money or goods they've donated. Being generous is a noble act, and the U.S. tax code often rewards that generosity, but only if you follow the rules carefully. Missing a step or failing to keep proper records can result in a lost deduction.

From ensuring the organization is qualified to understanding the difference between cash and non-cash donations, the process requires attention to detail. This guide will walk you through the key aspects you need to know to successfully and legally claim your charitable tax deductions.

1. The Organization Must Be a Qualified Charity

This is the first and most critical rule. A donation is only tax-deductible if it is made to a "qualified organization." The IRS has a strict definition for this, which generally includes non-profit groups that are religious, charitable, educational, scientific, or literary in purpose, or that work to prevent cruelty to children or animals. Most organizations we commonly think of as charities—like the Red Cross, local churches, synagogues, mosques, and established non-profits—fall into this category.

However, you cannot assume an organization is qualified. Donations to individuals, political campaigns or candidates, for-profit entities, or foreign organizations (with some exceptions) are not deductible. To be certain, you should use the IRS's Tax-Exempt Organization Search tool. This online database allows you to verify an organization's status and confirm that it is eligible to receive tax-deductible charitable contributions. Always check before you donate if you are unsure and plan to claim a deduction.

2. You Must Itemize Your Deductions

For the vast majority of taxpayers, claiming a charitable deduction requires you to itemize your deductions on your tax return using Schedule A (Form 1040). This is an "all or nothing" choice; you either take the standard deduction or you itemize all your eligible deductions, which can include mortgage interest, state and local taxes (SALT), and medical expenses, in addition to charitable giving.

You should only itemize if your total itemized deductions are greater than the standard deduction amount for your filing status. For the 2024 tax year (the return you file in 2025), the standard deduction amounts are significant. For example, they are $14,600 for single filers and $29,200 for those married filing jointly. If your total charitable gifts, mortgage interest, and other itemized expenses don't exceed this threshold, you will be better off taking the standard deduction and will not get a separate tax benefit for your donations.

3. Strict Record-Keeping is Essential

You cannot claim a deduction without proof. The IRS requires meticulous records for all charitable contributions, and the type of record needed depends on the size and nature of the donation. For any single cash contribution (including check, credit card, or payroll deduction) under $250, you must keep a reliable record, such as a bank statement, a canceled check, or a credit card statement that shows the charity's name, the date, and the amount.

For any single cash or non-cash contribution of $250 or more, you need more than just a bank record. You must obtain a contemporaneous written acknowledgment from the charity. This is a formal receipt that must include the amount of the cash contribution, a description of any non-cash property, and a statement confirming whether the organization provided you with any goods or services in exchange for the gift. "Contemporaneous" means you must have this receipt in hand by the time you file your tax return.

4. Rules for Non-Cash Donations Vary by Value

Donating goods like clothing, furniture, or a vehicle is a common way to give, but the rules are more complex than for cash. For donated goods, you can generally deduct their fair market value (FMV) at the time of the donation. FMV is the price a willing buyer would pay for the item in its current condition. It is not the price you originally paid for it. Organizations like Goodwill often provide valuation guides to help you estimate the FMV of common household items.

If the total value of your non-cash donations for the year exceeds $500, you must fill out and attach Form 8283, "Noncash Charitable Contributions," to your return. If you donate a single item or a group of similar items (like a stamp collection or paintings) valued at more than $5,000, you will likely need to get a qualified appraisal to support your deduction claim. Special rules also apply to donations of cars, boats, and airplanes, where the deduction is often limited to the gross proceeds the charity receives from selling the vehicle.

5. Be Aware of Annual Contribution Limits

While the government encourages giving, there are limits to how much you can deduct in a single year. For most cash contributions made to qualified public charities, you can deduct up to 60% of your adjusted gross income (AGI). For donations of non-cash assets, such as stocks or property, the limit is typically 30% of your AGI. These are known as AGI limitations.

If your donations in one year exceed these limits, you don't necessarily lose the deduction. The IRS allows you to carry over the excess contribution for up to five subsequent tax years. This ensures that taxpayers who make a very large, once-in-a-lifetime donation can still receive the full tax benefit over time. It's a good practice to consult with a tax professional if you plan on making a donation that might approach these AGI limits.

The Purpose and Evolution of Charitable Tax Deductions

The concept of a tax deduction for charitable giving is not a modern invention; it has been a cornerstone of the U.S. tax code for over a century. The deduction was first introduced in 1917, shortly after the modern federal income tax was established. The primary motivation was to ensure that the nation's charitable organizations, which relied on donations from the wealthy, would not see their funding dry up as new, higher income tax rates were enacted to fund World War I.

At its core, the charitable deduction serves as a government incentive to encourage private citizens and corporations to support non-profit organizations that provide public benefits. In essence, the government is forgoing tax revenue to empower private entities to perform services that might otherwise fall to the public sector, such as feeding the hungry, providing disaster relief, supporting the arts, and advancing education. This creates a powerful public-private partnership that has become integral to the fabric of American civil society.

Over the years, the rules governing these deductions have evolved. Congress has adjusted AGI limits, refined record-keeping requirements, and clarified what constitutes a "qualified organization" to prevent abuse of the system. The ongoing debate about the standard deduction versus itemized deductions directly impacts the effectiveness of this incentive. When the standard deduction is high, fewer people itemize, meaning fewer taxpayers receive a direct, line-item tax benefit for their generosity, even though their giving continues to support vital community services.

Common Questions About Charitable Giving

Can I deduct the value of my volunteer time or related expenses?

This is one of the most frequently asked questions about charitable deductions. The simple answer is that you cannot deduct the value of your time or services. For example, if you are a graphic designer and you volunteer 10 hours to design a brochure for a charity, you cannot deduct what you would have normally charged for that work. The IRS does not permit deductions for the value of volunteered labor.

However, you can deduct out-of-pocket expenses you incur while volunteering for a qualified organization. This includes the cost of supplies, uniforms, or other materials you purchase for your volunteer work. You can also deduct transportation expenses. For 2024, you can deduct the actual cost of gas and oil or take the standard charitable mileage rate, which is 14 cents per mile. Remember to keep detailed records of these expenses, including receipts and a log of your mileage, just as you would for a direct donation.

Are donations to crowdfunding sites like GoFundMe tax-deductible?

The rise of crowdfunding has created confusion around tax deductions. In most cases, donations made through platforms like GoFundMe are not tax-deductible. This is because these campaigns are typically set up to benefit a specific individual or family, making the donation a personal gift rather than a contribution to a qualified 501(c)(3) organization. The IRS is clear that gifts to individuals, no matter how deserving, do not qualify for a tax deduction.

There is an important exception. Some crowdfunding platforms host fundraisers that are started by and directly benefit a registered 501(c)(3) charity. If the campaign page clearly states that the funds are going directly to a qualified non-profit and you receive a tax receipt from that organization (not from the platform or an individual), then your donation would be deductible. Always verify that the ultimate recipient of the funds is a qualified charity before assuming your contribution is deductible.

What are the rules for donating appreciated property like stocks?

Donating long-term appreciated assets, such as stocks or mutual funds that you have owned for more than one year, can be one of the most tax-efficient ways to give. When you donate these assets directly to a charity, you can generally deduct the full fair market value of the security at the time of the donation. This provides a significant double benefit.

Not only do you get a deduction for the full value, but you also avoid paying capital gains tax on the appreciation. If you were to sell the stock first and then donate the cash proceeds, you would first have to pay taxes on the profit. By donating the stock directly, both you and the charity come out ahead. The deduction for this type of property is typically limited to 30% of your AGI, but as mentioned, any excess can be carried forward for five years.

Conclusion

Claiming charitable tax deductions when filing your 2025 taxes requires a clear understanding of the IRS rules. The cornerstones of a successful deduction are ensuring the recipient is a qualified organization, keeping immaculate records for every donation, and understanding the distinction between cash and non-cash contributions. You must also itemize your deductions to claim the benefit, a choice that is only advantageous if your total itemized expenses surpass your standard deduction amount. By planning your giving and maintaining careful documentation throughout the year, you can confidently claim the deductions you are entitled to and support the causes you care about in a tax-savvy way.

For more official information, you can visit these resources:

• IRS Tax-Exempt Organization Search
• IRS Publication 526, Charitable Contributions