What are the specific rules for deducting charitable contributions on a California state tax return?

California generally allows you to deduct charitable contributions if you itemize, but the calculation rules and limits differ slightly from federal law. To deduct these contributions, you must follow specific documentation and reporting procedures tied to your federal return. Here's how to properly deduct charitable contributions in California: Step 1: Itemize Your Deductions You can only deduct charitable gifts if you choose to itemize deductions on your California tax return, Form 540. You will report these on California Schedule CA (540), "California Adjustments." If you take the standard deduction, you cannot deduct any charitable contributions. Step 2: Confirm the Charity is a Qualified Organization Your donation must be made to a "qualified charitable organization." These are typically the same organizations that qualify for a federal deduction, such as 501(c)(3) entities like churches, hospitals, and educational institutions. You can verify an organization's status using the IRS's "Tax Exempt Organization Search" tool on their website. Step 3: Keep Meticulous Records For any cash contribution, you must have a bank record or a written receipt from the charity. For any single contribution of $250 or more (cash or non-cash), you must obtain a contemporaneous written acknowledgment from the organization before you file your return. This receipt must state the amount of cash or describe the non-cash property and indicate whether you received any goods or services in return. Step 4: Calculate Your Deduction Limit California limits your charitable deduction to a percentage of your federal Adjusted Gross Income (AGI), not your California AGI. The primary limit is 50% of your federal AGI for cash contributions to most public charities. Lower limits of 30% or 20% apply to donations of appreciated property or contributions to certain private foundations. Any amount you cannot deduct in the current year can generally be carried over for up to five years. Important details and nuances: You start by calculating your itemized deductions on federal Schedule A. That total is then transferred to California Schedule CA (540), where you make adjustments specific to California law. Unlike federal law in recent years, California does not and has never allowed a charitable deduction for non-itemizers. Warnings and limitations: You cannot deduct the value of your personal time or services. If you receive a benefit in exchange for your contribution (e.g., a ticket to a fundraising dinner), you can only deduct the amount of your contribution that is more than the value of the benefit you received. For non-cash donations over $5,000, you will likely need a formal appraisal. This is general information and does not constitute legal advice. For complex situations, such as large or non-cash donations, consult with a qualified California attorney or tax professional.