When a taxpayer files his or her income tax return, in the case that he or she may seek to claim an itemized deduction on a donation(s) made to any educational, cultural, public welfare and charitable agency or organization, the donation(s) is/are deductible but the total amount of the deduction(s) shall not exceed 20 percent of the taxpayer’s consolidated gross income.
Further, a donation(s) made to national defense, military or to the government or for the support of historical structures is/are fully deductible under the condition that the taxpayer must provide receipts of donation(s) for proof. For donations of land or columbarium, which meet the qualifications as required under the MORTUARY SERVICE ADMINISTRATION ACT, the documents required are (1) the certificate of donation issued by the authority/institute in receipt of the donation and (2) the contract of purchase of the land or columbarium, and the documents of payment, or any other adequate papers. From July 8, 2005, for a taxpayer who has made a donation of unlisted/GTSM company stock and wishes to claim a deduction in regard to the donation, the following requirements are to be met: the agency/institute to which the donation has been made is required to have sold the donated stock, taken receipt of the money thus accruing, and issued a certificate or receipt to the person making the donation which provides details of the total amount of money realized from the sale of the aforesaid stocks, and in this case, the donator may, upon production of the certificate or receipt at the time of the claim, itemize such donation as a deduction for the year in which the unlisted/GTSM company stock was sold.
The above-mentioned designations of “educational, cultural, public welfare, or charitable agency or organization” are applicable only to such institutions as are officially registered with the authorities in accordance with the ROC Civil Law or other relevant regulations.
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