The new CARES (Coronavirus Aid, Relief, and Economic Security) Act, designed to help you, businesses and non-profit organizations facing economic hardship during the coronavirus pandemic, was passed by Congress and signed into law on March 27, 2020.
Here are a few charitable giving provisions included in the CARES Act that may assist you with your philanthropic goals:
New Charitable Deduction for Non-Itemizers
- Taxpayers who take the standard deduction may claim a charitable deduction of up to $300 ($600 for married couples) for cash donations made in 2020.
Increased Deduction Limits
- Cash gifts can be deducted up to 100% of your AGI (Adjusted Gross Income) for the 2020 calendar year when directed to a qualified non-profit organization like the Charlottesville Municipal Band
- The corporate deduction limit has been raised to 25% of taxable income.
RMD (Required Minimum Distributions) Suspensions
- Regardless of age, the requirements for required minimum distributions (RMD) from retirement accounts are suspended for the 2020 tax year.
- If you would like to make a gift from your IRA – and are 70½ or older – you can still do so tax free. The annual tax-free contribution limit of $100,000 remains in place.
Please contact your tax advisor to receive the proper guidance for your situation.