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Givers 3min read

Church Giving and Taxes: What You Need To Know

The tax code has allowed church giving to be applied as a tax deduction for decades. However, you must follow the steps to get the paperwork right.

  1. You must use a standard, itemized deduction approach, which means a longer tax form like the IRS Form 1040 or 1040A. The fast process with a standard deduction makes it impossible to claim a charitable deduction, even to a church.
  2. The church you give to has to be a recognized charitable organization under the federal tax code. These organizations are identified as 501(c)(3) entities precisely due to the part of the tax code where their exemption is found.
  3. There needs to be a record or proof of the donation provided to you by your church. That’s usually produced in a canceled check copy or a receipt from the church receiving the donation. This document or record is essential because it’s proof the donation occurred for the amount claimed. Without it, you could be audited and have taxes adjusted for denial of a non-supported donation deduction.

Not All Church Giving Is Created Deductible Equally

Donations are limited, no surprise, in the amount you can claim as an itemized deduction. For example, a gift cannot be more than half of your earnings and reported adjusted gross income (AGI). Remember, this figure is less than your total l earnings because some amount comes right off the top for dependents and other adjustments.

Fortunately, if there is excess, prior year donations can be claimed on future years up to five tax returns later. It’s a bit like a deferred reduction of taxes if you keep good records.

Records are highly critical regarding cash donations as there is no other way to show the assistance occurred otherwise (i.e., no record of property title transfer). As noted earlier, a canceled check or receipt is standard documentation.

In addition, if a donation is more than $250, written acknowledgment by the church with specific terms is also needed as an added record required by the IRS.

Some people desire to donate property to their church, which is allowable. The property has to be assessed (i.e., hire an appraiser for a report) at market value. Regardless, this is the same for a car, jewelry, or land. With the documentation in order, the amount can be claimed as a deduction.

If there is a swap, only the donation difference above the value of the barter exchange can be claimed, not the whole donation.

Mobile Church Giving Makes Taxes Easier

Making church donations with the Givelify mobile giving app makes church gifts and electronic giving an easy reality and a big boon for tax return documentation. You can get detailed records on every church donation transaction, and a simple PDF record is sent to your email account.

Then all you have to do is print out the PDF for your tax records, adding it to church acknowledgment letters if necessary. This tool makes it far easier to remember everything you’ve donated to your church, which is a tax deduction.

Givelify also verifies all churches are valid legal entities with the I.R.S., so you always know your donations are tax deductible.


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About the Author

Matt is dedicated to making the world a better place. He works passionately to help charitable causes use mobile technology to raise the funds they need. In addition to his role at Givelify, he volunteers with the Southside Animal Shelter and Kentuckiana Pug Rescue.

Matt Chandler