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Tax Info P.E.P. tax id 95-3880183

All information on this page is accurate to the best of our knowledge as of August 2022. Always talk to your CPA or a certified accountant when making tax decisions, as your particular situation may be unique.

Palisades Enrichment Programs is a 501(c)(3) Non-profit Corporation, which means any donation you make to PEP is eligible to be tax deductible. However that doesn't mean you will actually see any savings on your taxes, and we want to make sure there are no surprises at tax time.

The first question is: Do you itemize your deductions?

YES

If you itemize for both State and Federal taxes, you can deduct 100% of your donation except in very rare cases. Jump to How much will I save? if you have further questions.

NO

If you are sure you don't itemize Federal OR State taxes, you are still allowed to deduct $300 ($600 if married) on your Federal tax return.

NOT SURE

Definitely talk to an accountant, but we've provided some information below for basic cases.

Information on Itemized Deductions

On both State and Federal income taxes there is a concept of a Standard Deduction. If qualifying deductions (such as state & local tax, mortgage interest, charitable donations) exceed the Standard Deduction for a return, you likely itemize your deductions as you want to use whichever is greater. 

Links about standard deductions: Federal and State.

As a rule of thumb in California, if you own your home and have a mortgage in excess of $500,000,  you likely Itemize deductions at both the State and Federal Level as your Itemized Deductions might exceed the Standard Deduction.

Keep in mind, you may itemize deductions on your California return, but take the Standard Deduction on your Federal return.

If you are not sure always ask a professional as many parts of this calculation changed with the Tax Cuts and Jobs Act of 2017.

How much will I save?

To figure out how much you'll save you need to know your top marginal income tax rate for both your Federal & State tax returns. While your effective income tax rate may be 20% or 30% (this is just taxes paid divided by income), when you are trying to figure how much a charitable donation will save you on your taxes, all that matters is how much the last dollar was taxed.

Here is some info on the tax brackets for 2022: Federal and State.

Your top marginal rate, can be much higher than your effective tax rate. Consider that for some filers, a $10,000 donation could result in $5,000 in tax savings.

It is a privilege that the Charter School model allows these contributions to be tax deductible. Doing so allows our dollars to go further, and so it is important to think about your contribution in terms of its real cost to your family. A $5,000 tax-deductible donation to PEP, does not "cost" nearly as much as a $5,000 vacation, so we have provided all of this information to help you make the best decision for your family.

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