Cares Act for Charitable Giving
The CARES Act includes increased tax benefits for individuals and businesses who make charitable contributions in 2020.
Standard Deduction
If you plan to take the standard deduction (non-itemized) on your 2020 tax return, the CARES Act allows you to take an ‘above-the-line’ tax deduction of up to $300 for donations to charitable organizations. For reference, the 2020 standard deductions are: $12,400 for individuals and $24,800 for married couples filing jointly. Any donation to qualifying charities, up to $300, will be added to the standard rate of deduction. This deduction will continue into future tax years.
Itemized Deduction
If you plan to itemize your deductions on your 2020 tax return, the CARES ACT allows you to take a tax deduction, up to 100% of your Adjusted Gross Income (AGI), for contributions to qualifying charities. The CARES Act lifts the 60% of AGI limit for cash donations made in 2020.
Corporate Donations
For corporate donors, the CARES Act allows an entity to take a tax deduction of up to 25% of their Adjusted Tax Income for contributions to qualifying charities starting in 2020. The CARES Act lifts the 60% of AGI limit for cash donations made in 2020.
This information is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor.