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Corporations and charitable gifts

A corporation that files its own tax return can deduct charitable gifts up to 10% of its taxable income.

Taxable income for this purpose is calculated without the following.

  • The deduction for charitable contributions.
  • The dividends-received deduction.
  • The deduction allowed under Internal Revenue Code Section 249 [relating to deduction of bond premium on repurchase].
  • The domestic production activities deduction.
  • Any net operating loss carryback to the tax year.
  • Any capital loss carryback to the tax year.

Corporations are also entitled to carryover unused deductions for five years.