Tax deductibility for a donor is based on the total amount donated to any given certified 501(c)(3) nonprofit. Nonprofits pay the processing costs of donations. Donors have the option to increase their donation by an amount equal to the processing fees, so the nonprofit realizes the full amount of the intended donation. For example, if a donor elects to cover the processing fee on a $25 donation, then it is likely the increased amount (i.e. $25.82) would be tax-deductible. That is the rule of thumb, but Goodworld does not provide tax advice so please consult your local tax professional about what portion of the full donation amount can be claimed as a charitable contribution.
Are donor charitable contributions with covered processing fees tax deductible or just what is given minus the fees?
Written by Raagini Sarkar
Updated over 3 years ago