Discussion:Effect of itemized deductions greater than AGI on charitable contribution
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Discussion Forum Index --> Tax Questions --> Effect of itemized deductions greater than AGI on charitable contribution
| 6 September 2007 | |
| Hi cannot seem to find the answer to this - thought it would be simple - my client has itemized deductions greater than his AGI; included in his itemized deduction are charitable contributions. I also have an NOL carryforward from a prior year. What is the effect on the charitable contributions? I think the answer is this: take my agi, less the charitable deduction subject to the 50% of agi, less the nol carryforward. The sum of these figures is my new NOL carryforward. Since I have an nol I can't use any of my other itemized deductions so they're lost. | |
TheTinCook (talk|edits) said: | 6 September 2007 |
| It would change AGI thus decrease the max contributions deductions, but lessen any phase-out due to high income. You may not have a new NOL.
First thing you would do is put the NOL carryforward on Line 21 as a negative figure, and figure your AGI. Remember a NOL deduction for the current year can't be more then taxable income. Second you would figure out your allowed itemized deductions. Third you would figure out your taxable income. Fourth, if your taxable income is below zero, you would figure out if you have a NOL. Non-business deductions, (like charity deductions) in and off themselves cannot create an NOL since they are disallowed in excess of non-business income in figuring an NOL. You may want to take a look at Pub 536 I can't tell you more with out number or more details. | |
