The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides more than $2 trillion in relief funds to support the U.S. economy. The CARES Act also includes a few important provisions that provide additional tax relief for charitable giving in the 2020 tax year. Consult your financial advisor to find out of these changes apply to you.
The new law allows all taxpayers who take the standard deductions instead of itemized deductions on their 2020 tax return to claim a charitable deduction of up to $300. A reduction in taxable income is available in 2020 for individuals who do not itemize their deductions. It is an “above-the-line” adjustment to income that will reduce your adjusted gross income (AGI) and thereby reduce taxable income. This adjustment is available for cash gifts to public charities and is limited to $300 per taxpayer ($600 for a married couple). It is not available for gifts to donor advised funds.
60% of AGI Limit Waived
For those who do itemize their deductions, the new law allows for cash contributions to qualified charities to be deducted up to 100% of your adjusted gross income for the 2020 compared to the typical 60% limit. For the 2020 tax year only, an individual may elect to apply a new 100% of adjusted gross income (AGI) limit to cash gifts to public charities. Gifts to donor advised funds or supporting organizations are not eligible for this special election. The 100% limit is reduced dollar-for-dollar by other itemized charitable deductions.
Required Minimum Distributions Suspended for Qualified Retirement Plans
Finally, the new law suspends the requirements for required minimum distributions (RMD) from most qualified retirement plans, including IRAs for the 2020 tax year. Even so, making a qualified charitable distribution (QCD) this year will still allow itemizers and non-itemizers alike to direct up to $100,000 from their IRA to charities in a tax efficient manner. If you are 70½ or older, you can still make a gift from your IRA or name us as a beneficiary.
We encourage you to consult your tax professional or financial advisors to learn more about how these changes to the law may apply to your financial situation.
New donors making a contribution of $25,000 – $100,00 are eligible for a 1:1 match through Island Conservation’s Clipperton Matching Fund. Existing Island Conservation donors who increase their giving by $25,000 are eligible to match the amount of their increased giving up to $100,000.
Your donation is tax-deductible Donation to Island Conservation, a 501(c)(3) charity, are tax-deductible to the fullest extent allowed by law. Island Conservation’s tax Identification number is: 91-1839907
We will not sell, share or trade our donors’ names or personal information with any other organization, nor send mailings to our donors on behalf of other entities.
This policy applies to all donor information received by Island Conservation, both online and offline as well as any electronic, written, or verbal communications.