11/10/2020

What you need to know about charitable provisions in the CARES Act

The following article is from GSB Fundraising and is written by JIM SCHADE

Charitable Provisions in the CARES Act

The CARES Act had two major charitable provisions.  First, it allows donors to deduct up to 100% of Adjusted Gross Income (AGI) vs. the normal 60% limitation.

Secondly, for those who take the standard deduction (which is most) there’s a provision to allow an additional $300, above-the-line, charitable deduction.

We’ve provided some sample copy for use in your Newsletter Articles and Annual Appeal

Charitable Gifts in 2020

Most taxpayers take advantage of the standard deduction when they are filing their Federal Income Tax Returns. The CARES Act provides an additional, “above-the-line” charitable deduction on top of the standard deduction for these taxpayers.

Taxpayers who do not itemize their deductions can take a one-time deduction of up to $300 for gifts made to ____(charity)_______. The deduction applies ONLY for gifts of cash made in the calendar year 2020.

If you are not itemizing on your 2020 taxes, you can claim this new deduction. 

Note to Leadership

These charitable provisions can provide incentives for potential donors to begin or increase charitable contributions.

For Example: In reviewing annual giving records, there are a number of members that are not contributing financially. In your appeal for 2020, this CARES Act provision that allows for an additional $300 deduction above the standard deduction should be emphasized to encourage new and increased gifts.