Most churches and religious groups are tax-exempt 501(c)3 organizations. This status allows individual church members to receive income tax deductions equal to the amount of funds pledged and subsequently donated within a tax filing year. The Internal Revenue Service, or IRS, maintains a set of rules that specify the reporting and substantiation requirements for claiming a tax deduction for church donations.
Making a pledge or a commitment for a donation does not automatically allow you to claim the pledge amount as a deduction on your tax return. Instead, only the actual contributions made toward the pledge total become tax deductions. For example, if you make a $600 pledge to your church in November and donate $400 toward the pledge in December, then $200 in January, only the $400 actually presented to the church during the tax year is recognized as a deduction by the IRS. The additional $200 would be claimed on the following tax filing year.
Donations Less than $250
When you pledge and then donate a single payment of less than $250, a check stub, credit card statement, church receipt or a bank statement serve as suitable proof to the IRS of your donation. Make sure that your proof lists the charity, contribution amount and date of the donation.
Donations over $250
When you pledge and donate over $250 in a single payment, additional acknowledgment of your donation is required in order to claim a valid tax deduction for the amount. You must obtain a written statement from the church that contains the church's name and date, the amount of your donation, a description of any goods donated and, when applicable, a description of any goods or services you received in return for your donation.
Quid Pro Quo Donations
When you make a pledge and subsequent donation of $75 or more and receive an item or service in return, such as a travel voucher or dinner, the donation is known as a quid pro quo contribution. Your church must list the gift or service you receive and its full value on a written statement. Your donation deduction is reduced by the value of the gift. For example, if you donate $80 and receive a $10 gas voucher, your tax deduction for the donation would be reduced to $70.
Responsibilities for Records
Although the IRS maintains that a church should be aware of the IRS reporting requirements for quid pro quo contributions, the final responsibility for obtaining the paperwork required to claim a charitable contribution tax deduction falls on the donor. Request the paperwork your donation requires from your church if documentation is not voluntarily provided.
Claiming Deductions for Donations
Charitable contributions are reported to the IRS on tax form Schedule A, or Form 1040, Itemized Deductions, under the section labeled "Gifts to charity." When the contributions are added to your other itemized deductions for the tax year, the total itemized deduction from Schedule A is reported on Form 1040, U.S. Individual Income Tax Return under the "Tax and credits" section.
Ashley Mott has 12 years of small business management experience and a BSBA in accounting from Columbia. She is a full-time government and public safety reporter for Gannett.