Charitable Act is a new bipartisan bill introduced on the first week of March to help people deduct charitable contributions from their taxes.
It should be noted that in the 2020 tax year, up to $300 is a deduction when making cash donations. And in the 2021 tax year, married couples could deduct up to $600. However, the charitable contribution deduction expired in 2022.
This year, Charitable Act was proposed by Senator James Lankford (R-Ok) and Senator Chris Coons (D-De). The bipartisan bill aims to deduct more than $9,000 for married couples filing jointly and over $4,500 for individuals.
The Charitable Act is a proposed bipartisan bill that aims to boost the tax deductions from charitable donations and encourage Americans to donate and support local community-based organizations. (Photo: The CPA Journal)
MarketWatch reports the deduction amount would be one-third of the standard deduction, which means the size of the proposed write-off would increase over time as it is tied to the standard deduction. The standard deduction is adjusted annually and indexed for inflation.
This year, the standard deduction for individual taxpayers is $13,850, and one-third is $4,570. While married couples filing jointly have a $27,700 standard deduction – one-third is $9,141.
Senator Lankford said at a press conference that the bill aims incentivize Americans who donate to nonprofits or government organizations. Tim Delaney, president and CEO of the National Council of Nonprofits, has supported the bipartisan bill. He said millions of taxpayers would be encouraged to help their local community-based organizations.
