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Module 12 Itemized Deductions 4

Itemized Deductions

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Marklein Dumangeng
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52 views1 page

Module 12 Itemized Deductions 4

Itemized Deductions

Uploaded by

Marklein Dumangeng
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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A. Depletion – for oil and gas wells and mines resources.

B. Charitable and other contributions


1. The contribution or gift must be actually paid
2. The contribution of property must be measured based on acquisition cost
3. It must be given to an organization specified by lass
4. Net income of the specified institution must not inure to the benefit of any
private SH or individual
5. The person making the contribution must be engaged in trade, business or
profession
Classification of contributions
A. Fully deductible
1. Donation to the government or political subdivisions including fully owned
GOCC to be used exclusively for priority activities
2. Donation to foreign institution or international organizations in compliance
with agreement or treaties
3. Donations to accredited domestic NGOs
Requisites:
1. The donation must be utilized by the donee institution not later than the
15th day of the 3rd month following the close of the taxable year
2. The administrative expense must not exceed 30% of the total expenses
3. Upon dissolution, assets must be distributed to another non-profit domestic
corporation of the government ( If not complied, donation is subject to limit)
B. Contributions subject to limit
1. Donations to the government or political subdivisions for public purpose
2. Donation to non-government organization or to a domestic corporation
organized exclusively for the following purposes:
1. Religious
2. Charitable
3. Scientific
4. Youth and sports development
5. Cultural
6. Educational
7. Rehabilitation of veterans
8. Social welfare
Limit of deduction: based on the taxable income derived from business or
profession prior to the deduction of contributions ( either fully deductible or
subject to limit)
a. 10% for individuals
b. 5% for corporations
Deductible contribution subject to limit – shall be whichever is lower of the
actual contribution with the limit as set forth herein

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