How charitable contributions affect Americans' taxes

PolicyEngine estimates the tax impact of your donations for free.

Today is Giving Tuesday, when many Americans will consider giving to charity. Filers who itemize can deduct these charitable contributions from their taxable income. For many filers, these donations will reduce tax liability, either by putting them over the itemization threshold or increasing their itemized deductions.

This video shows an example of a New York resident with $200,000 in employment income and no other itemized deductions. Without charitable contributions, PolicyEngine estimates that they would owe $64,255. If they donate $20,000, they would instead owe an estimated $58,043. That is, their taxes fall by $6,212, offsetting 31% of their donation.

Federal taxes comprise 88% of this impact.

To estimate how charitable giving would affect your own household, visit policyengine.org.

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PolicyEngine estimates do not constitute exact tax liabilities or financial advice. This example is for New York state in 2022 and does not include New York City taxes. PolicyEngine currently estimates state income taxes in Maryland, Massachusetts, New York, Oregon, Pennsylvania, and Washington.

max ghenis
PolicyEngine's Co-founder and CEO

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