Income Tax Topics: Charitable Contributions 

Any individual who claims the basic standard deduction          Taxpayers who cannot claim the subtraction 
on  their  federal  income  tax  return,  and  is  therefore 
unable  to  claim  a  federal  itemized  deduction  for         Taxpayers  cannot  claim  the  charitable  contribution 
charitable  contributions,  can  claim  a  subtraction  on      subtraction  if  they  claim  itemized  deductions  on 
their  Colorado  return  for  a  portion  of  any  qualifying   Schedule A of their federal Form 1040 or Form 1040-SR. 
charitable contributions they make during the tax year.         Anyone who claims itemized deductions on Schedule A 
                                                                of  their  federal  return  cannot  claim  any  charitable 
This publication is designed to provide general guidance        contribution subtraction on their Colorado return.  
regarding the charitable contribution subtraction and is 
intended  to  supplement  guidance  provided  in  the           Additionally,  the  charitable  contribution  subtraction 
Colorado Individual Income Tax Guide   . Nothing in this        cannot be claimed by any taxpayer who is not allowed 
publication  modifies  or  is  intended  to  modify  the        to claim a standard deduction on their federal return. 
requirements  of  Colorado’s  statutes  and  regulations.       Taxpayers  who  cannot  claim  a  federal  standard 
Taxpayers are encouraged to consult their tax advisors          deduction  and  therefore  cannot  claim  the  charitable 
for guidance regarding specific situations.                     contribution subtraction include, but are not limited to: 

                                                                ➢ taxpayers who can be claimed as a dependent by 
                                                                  another taxpayer; 
Eligible taxpayers 

                                                                ➢ married individuals filing separate returns if either 
The charitable contribution subtraction is allowed only 
                                                                  spouse claims itemized deductions; 
to  taxpayers  who  satisfy  all  three  of  the  following 
requirements:                                                   ➢ non-resident alien individuals; 

 1) The taxpayer must be either an individual or two            ➢ individuals who file a federal tax return for a 
    individuals filing a joint return;                            period of less than 12 months in order to change 
                                                                  their annual accounting period; 
 2) The  taxpayer  must  have  claimed  the  standard 
    deduction, instead of itemized deductions, on their         ➢ estates, trusts, corporations and other legal 
    federal income tax return for the tax year; and               entities. 

 3) The taxpayer must have made qualifying charitable 
    contributions.                                              Qualifying charitable contributions 

A taxpayer who satisfies all of these requirements can 
                                                                A contribution must meet the qualifications applicable 
claim  the  charitable  contribution  subtraction,  even  if 
                                                                to the federal charitable contribution deduction in order 
the  taxpayer  has  claimed  a  charitable  contribution 
                                                                to  be  eligible  for  the  charitable  contribution 
deduction on line 10b (for tax year 2020) or line 12b (for 
                                                                subtraction. Contributions of both money and property 
tax year 2021) of their federal Form 1040 or Form 1040-
                                                                can  qualify  for  the  subtraction,  but  the  contribution 
SR. 
                                                                must be made to a qualified organization to be eligible 
                                                                for  the  subtraction.  Examples  of  qualified  and 
                                                                nonqualified organizations are listed below.  

                                                                Certain rules and limitations relating to the subtraction 
                                                                are discussed below. Please see IRS Publication 526 for 
                                                                additional information regarding qualifications. 

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Income Tax Topics: Charitable Contributions 

Non-monetary contributions of property                            Qualified organizations 

Non-monetary  contributions  of  property  made  to               Contributions  made  to  the  following  types  of 
qualified  organizations  are  generally  eligible  for  the      organizations  will  generally  qualify  for  the  charitable 
charitable contribution   subtraction.      However,              contribution subtraction: 
contributions of clothing and household items qualify for 
the subtraction only if either the items are in good used         ➢ Religious organizations including churches, 
condition or better or the item of clothing or household            temples, synagogues, or mosques; 
item  is  valued  at  more  than  $500  by  a  qualified 
appraisal. Please see IRS Publication 526 for additional          ➢ Nonprofit charitable organizations; 
information regarding qualified appraisals. 
                                                                  ➢ Nonprofit educational organizations; and 

Contributions from which you benefit                              ➢ Nonprofit hospitals and medical research 
                                                                    organizations. 
A taxpayer who receives or expects to receive a financial 
or economic benefit as a result of making a contribution          This is not an exhaustive list of qualified organizations. 
cannot  claim  the  subtraction  for  any  part  of  the          Qualified  organizations  can  be  verified  online  at 
contribution that represents the value of the benefit they        IRS.gov/TEOS.  Please  see  IRS  Publication  526  for 
receive. Please see Calculating the allowable subtraction,        additional information regarding qualified organizations. 
later in this publication, for information about calculating 
the subtraction for contributions that exceed the amount 
of benefit the taxpayer receives in return.                       Nonqualified organizations 

                                                                  Contributions  made  to  the  following  types  of 
Certain non-qualifying contributions                              organizations generally do not qualify for the charitable 
                                                                  contribution subtraction: 
The Colorado charitable contribution subtraction cannot be 
claimed for any contribution that does not qualify for the        ➢ Civic leagues, social and sports clubs, labor 
federal  charitable  contribution  deduction.  Qualified            unions, and chambers of commerce; 
charitable distributions and contributions of services are 
two types of nonqualifying contributions and are discussed        ➢ Foreign organizations (except certain Canadian, 
briefly  below.  For  additional  information  about  non-          Israeli, and Mexican charities); 
qualifying  contributions,  please  see  the  section  titled 
“Contributions You Can’t Deduct” in IRS Publication 526.          ➢ Groups that are run for personal profit; 

Qualified charitable distributions                                ➢ Groups whose purpose is to lobby for legislative 
                                                                    changes; 
Qualified charitable distributions, made directly by the 
trustee of an individual retirement arrangement (IRA),            ➢ Homeowners’ associations; and 
that are excluded from federal taxable income do not 
                                                                  ➢
qualify for the subtraction. Please see IRS Publication             Political groups or candidates for public office. 
526 for additional information about qualified charitable 
distributions.                                                    This  is  not  an  exhaustive  list  of  nonqualified 
                                                                  organizations.  Please  see IRS  Publication  526  for 
Contributions of services                                         additional information      regarding qualified  and 
                                                                  nonqualified organizations. 
  Contributions of services do not qualify for the subtraction. 

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Income Tax Topics: Charitable Contributions 

Calculating the allowable subtraction                            Valuing contributions of property 

In  general,  the  charitable  contribution  subtraction  is     For non-monetary contributions of property, the amount 
calculated by subtracting $500 from the total amount of          of  the  charitable  contribution  is  generally  the  fair 
qualifying contributions made by the taxpayer during the         market  value  of  the  property  at  the  time  of  the 
tax year. For example, if a taxpayer who is eligible to          contribution, not the original cost of the property. The 
take  the  charitable  contribution  subtraction  made           fair market value of used clothing and household goods 
several  qualifying  contributions  totaling  $1,200  during     is usually far less than what was paid for them when they 
the  tax  year,  the  taxpayer  could  claim  a  charitable      were new and is determined by the price the used item 
contribution subtraction of $700. However, there are a           would  sell  for  in  a  consignment  store  or  thrift  shop. 
variety  of  other  federal  rules  that  may  affect  the       Please see  IRS Publication 561 for guidance in valuing 
calculation of the subtraction. Some of these rules are          donated property.  
described below. Additional information regarding these 
rules can be found in IRS Publication 526.                       Limitation based on adjusted gross income (AGI) 

                                                                 The  allowable  amount  of  the  charitable  contribution 
Contributions from which you benefit 
                                                                 subtraction  is  subject  to  the  same  limitations  as  the 
If a taxpayer receives a benefit as a result of making a         federal  charitable  contribution  deduction.  In  general, 
contribution to a qualified organization, only the amount        the federal deduction is limited to a percentage of the 
of the contribution that is more than the value of the           taxpayer  ’sadjusted  gross  income  (AGI).  A  subtraction 
benefit  received  may  qualify  for  the  subtraction.  If  a   claimed  in  excess  of  $5,000  for  a  noncash  charitable 
taxpayer pays more than fair market value to a qualified         contribution  of  one  item  or  a  group  of  similar  items 
organization for goods or services, the excess may be a          generally  requires  an  appraisal.  Please  see IRS 
charitable  contribution.  For  the  excess  amount  to          Publication  526  for  additional  information  regarding 
qualify, the taxpayer must pay it with the intent to make        limitations on the amount of the subtraction.  
a charitable contribution. 
                                                                 No carryforward of excess subtraction  
Contributions that qualify for tax credits 
                                                                 Any  excess  charitable  contributions  that  cannot  be 
In  general,  if  a  taxpayer  who  makes  a  charitable         subtracted  because  of  the  limitations  discussed  above 
contribution  receives  or  expects  to  receive  a  state  or   cannot  be  carried  forward  or  carried  back  and 
local tax credit as a result of the contribution, then the       subtracted on any subsequent or prior Colorado income 
amount that is eligible for the subtraction is reduced by        tax return. Additionally, if the charitable  contribution 
the amount of the credit, even if the taxpayer cannot            deduction a taxpayer claims on their federal return is 
claim the credit in the tax year. The required reduction         limited,  the  taxpayer  cannot  claim  a  charitable 
does not apply if the state or local tax credit allowed for      contribution subtraction on their Colorado return for the 
the contribution is 15% or less of the contribution. State       current  year,  prior  year,  or  subsequent  year  for  the 
tax  credits  that  may  reduce  the  amount  of  the            excess contributions.     
contribution that is eligible for subtraction include, but 
are not limited to, the child care contribution credit and 
the enterprise zone contribution credit.  

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Income Tax Topics: Charitable Contributions 

Claiming the subtraction                                     Additional Resources 

Eligible  taxpayers  who  make  qualifying  charitable       The following is a list of statutes, regulations, forms, and 
contributions  can  claim  the  charitable  contribution     guidance  pertaining  to  the  charitable  contribution 
subtraction by entering the appropriate amount on the        subtraction. This list is not, and is not intended to be, 
applicable line (“Qualifying Charitable Contribution”) of    an  exhaustive  list  of  authorities  that  govern  the  tax 
the Subtractions  from  Income  Schedule  (DR 0104AD).       treatment of every situation. Individuals and businesses 
Any  charitable  contribution  subtraction  claimed  by  a   with specific questions should consult their tax advisors. 
part-year resident or nonresident on form DR 0104AD is 
not entered on the subtractions line on the Part-Year 
                                                             Statutes and regulations 
Resident/Nonresident  Tax  Calculation  Schedule  (DR 
104PN).                                                      ➢ § 39-22-104, C.R.S. Income tax imposed on 
                                                               individuals. 
Substantiation requirements 
                                                             ➢ Rule 39-22-104(4)(m). Charitable contribution 
Taxpayers claiming   the     charitable contribution           subtraction. 
subtraction must retain records sufficient to verify any 
                                                             ➢
contributions  for  which  the  subtraction  was  claimed.     Rule 39-22-110. Apportionment of tax for part-
                                                               year residents and nonresident individuals. 
Additionally,  taxpayers  may  be  required  to  submit 

documentation with their Colorado return, including, for     ➢ 26 U.S.C. § 170. Charitable contributions. 
example, a completed IRS Form 8283, depending on the 
amount of their cash and noncash contributions. Please       ➢ 26 C.F.R. §§ 1.170A-1 through 1.170A-18. 
see the substantiation requirements in IRS Publication 
526 and the instructions for Colorado form DR 0104AD  
and IRS Schedule A for additional information.               Forms and guidance 

                                                             ➢ Tax.Colorado.gov  

                                                             ➢ Subtractions from Income Schedule (DR 0104AD) 

                                                             ➢ IRS Publication 526, Charitable Contributions 

                                                             ➢ IRS Publication 561, Determining the Value of 
                                                               Donated Property  

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