What Does the CARES Act Mean for Philanthropy?

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act), signed into law on March 27, is the largest stimulus package in history. It also has implications to help stimulate charitable giving.

An above-the-line deduction for a “Qualified Charitable Contribution” of up to $300 for non-itemizers is available for cash contributions made to nonprofits (excluding donor advised funds and supporting organizations) for the 2020 tax year and beyond.

For cash contributions to charities (excluding donor advised funds and supporting organizations) made in 2020, the AGI limit is increased from 60% to 100%, with a 5-year carry forward for contributions that exceed 100% of AGI. The SECURE Act changed the age at which you must start taking required minimum distributions from your retirement account from 70½ to 72. This change gives your account additional time to grow. (Special note: For those born BEFORE July 1, 1949, the previous rules apply. Donors who turned 70½ in 2019 or earlier will have to continue taking required minimum distributions.)

Want to know how a gift to a nonprofit today could make a difference when you file taxes? We encourage you to speak with your financial advisor or accountant to see if this legislation would be beneficial to you and your planning.

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