A few years ago, Congress passed legislation that changed the standard deduction, and with it, the way many people gave to charities.

Charitable contributions are an itemized deduction, as opposed to the standard deduction. So, if you don’t have enough itemized deductions to increase it over the standard deduction, there is essentially no tax benefit for your donation. This is where a Donor Advised Fund (DAF) comes in….

If you give to charity but take the standard deduction, you typically do not get a tax benefit for your charitable giving. Because of this, many individuals stopped recording their charitable gifts on their tax return because it was simply a waste of time. However, your 2020 taxes are a bit different. Congressed authorized a special charitable giving deduction last year to help increase donations, as many charities suffered through the pandemic.