Deductions and Credits
Weddings can be an expensive endeavor, but in this time of social distancing, opting for a virtual wedding could end up saving you a fortune at tax-time! Have you considered hosting a virtual wedding? If you’re on the fence about it, you can save on expenses like the venue and food. And more good news — you may be able to claim certain qualifying tax deductions to recoup some of the investment you made in the sake of matrimony.
3 Tax Deduction Ideas for Your Virtual Wedding:
Whether you got married in 2019 and still need to file your 2019 taxes or are planning a virtual wedding this year, here are three tax deduction ideas for your wedding.
The gown: While you can’t get a tax deduction for buying the wedding dress of your dreams, the good news is you may be able to donate and deduct it as a charitable contribution. Depending on the price tag on your dress, you may need to also get an appraisal. If your dress happens to be more than $5,000, it must also be appraised. Be sure to keep all receipts and documentation related to the donation so you can claim the contribution on your taxes.
Note that when you donate your wedding dress, it must be donated to a 501(c)(3) qualified organization such as the non-profit organization Making Memories or Brides Against Breast Cancer. By choosing to donate your wedding dress, you can feel good and proud knowing you helped others in need, enjoy their special day in style!
Wedding favors: With a virtual wedding, wedding favors may be a moot point, but you can still make a donation to a charity on behalf of everyone attending your virtual wedding, as a “thank you” for their part in your special day! You’ll help others while garnering yourself a tax deduction. Another thought is to let your wedding party choose the charities they treasure, which will further extend the reach of this good-faith measure!
Gift registry: Along with a traditional gift wish list, you can create a charity registry through myregistry.com to encourage guests to donate to your favorite cause. Donations are tax-deductible so your guests can feel good while giving back and celebrating you at the same time.
Keep in mind, that in order to claim a tax deduction for charitable donations, you generally need to meet two requirements:
*Usually, you must have enough tax deductions to benefit from claiming itemized deductions
You must donate to a not-for-profit 501(c)(3) charitable organization
*Under CARES Act relief, you can deduct up to $300 in charitable contributions on your 2020 taxes (the ones you file in 2021) even if you don’t itemize your deductions.
Be sure to document your donations with receipts or acknowledgments, so you’ll have the documents available at tax time. Then you can claim your tax deductions, boost your tax refund, and have extra funds to toast your wedded bliss.
TurboTax ItsDeductible will help you accurately value and track your donations year-round. And with this tool, you can easily transfer information to your TurboTax tax return, come tax time.
Don’t worry about knowing these tax rules — it’s time to celebrate. TurboTax asks you simple questions about you and gives you the tax deductions and credits you’re eligible for based on your answers.
If you have questions, you can connect live via one-way video to a TurboTax Live CPA or Enrolled Agent with an average 15 years experience to get your tax questions answered. TurboTax Live CPAs and Enrolled Agents are available in English and Spanish and can also review, sign, and file your tax return.