How should a married couple filing jointly report a cash charitable contribution made from a joint account?
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When a married couple files a joint federal income tax return and makes a cash charitable contribution from a joint account, the contribution is generally treated as made by both spouses, regardless of which spouse physically signed the check or initiated the payment. Here’s how the reporting and deduction should be handled:
1. Deduction on a Joint Return
- Full Deduction Allowed: The couple may claim the full amount of the cash charitable contribution as an itemized deduction on their joint return, subject to the applicable percentage limitations (generally up to 60% of their adjusted gross income for cash contributions to qualifying public charities, with lower limits for certain other types of contributions or organizations).
- Joint Account Presumption: When a contribution is made from a joint account, the IRS presumes that the contribution is made equally by both spouses, unless there is clear evidence to the contrary (such as separate property or a prenuptial agreement specifying otherwise).
2. Substantiation Requirements
- Bank Record or Written Acknowledgment: The couple must retain a bank record (such as a canceled check or bank statement) or a written acknowledgment from the charity showing the name of the organization, the date, and the amount of the contribution.
- Name on the Account: If the joint account is in both spouses’ names, either or both may claim the deduction on a joint return. If only one spouse’s name is on the account, but a joint return is filed, the deduction is still allowed, as the funds are considered marital property unless state law or other evidence indicates otherwise.
3. Community Property States
- Community Property Rules: In community property states, funds in a joint account are generally considered community property, and contributions from such accounts are treated as made equally by both spouses, regardless of which spouse signed the check or made the payment.
4. Reporting on the Tax Return
- Schedule A (Form 1040): The total amount of cash charitable contributions should be reported on Schedule A (Form 1040), line 11, for cash contributions. The deduction is taken by the couple jointly on their return.
5. If Filing Separately
- Allocation: If the couple files separate returns, the deduction for a contribution from a joint account is generally split equally, unless they can show a different allocation (for example, if the funds were from the separate property of one spouse).
Summary: On a joint return, a cash charitable contribution made from a joint account is reported as a joint contribution and the full deduction is claimed on Schedule A (Form 1040), subject to the usual percentage limitations. The IRS presumes the contribution is made by both spouses, and proper substantiation must be maintained. In community property states, the same general rule applies unless there is evidence to the contrary.
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