The CARES Act & Charitable Giving

On March 27, President Trump signed the Coronavirus, Aid, Relief, and Economic Security (CARES) Act. The CARES Act includes significant statutory changes to federal law that will impact charitable giving, philanthropic planning, and financial planning. In many ways, the CARES Act enhances the tax benefits of supporting charities like VISTE.

Key provisions that may impact your charitable giving in 2020:

  • Individuals who do not itemize can deduct up to $300 for charitable gifts while still taking the standard deduction
  • No deduction limitation on cash charitable gifts (up to 100% of adjusted gross income) for those who itemize
  • An increase of the allowable limit of corporate charitable gifts from 10% to 25%
  • An increase of the allowable limit of charitable gifts of food inventory by businesses from 15% to 25%

Other changes that may impact your financial and estate planning:

Note: This is a partial list, please consult your professional advisers.

  • Temporary elimination of required minimum distributions (RMDs) from retirement plans for 2020
  • The temporary elimination of RMDs does NOT change the availability of the Qualified Charitable Distribution (QCD), sometimes also referred to as a “charitable IRA rollover”
  • Tax Year 2019 filings and payments previously due by April 15 are now due by July 15
  • Individuals will receive rebate payments of up to $1,200 ($2,400 for joint filers) and $500 for each dependent age 17 and younger with payment amount subject to a phase-out provision based on adjusted gross income
  • Social Security tax payments by employers and self-employed individuals previously due through January 1, 2021 are deferred in equal installments to December 31, 2021 and December 31, 2022

The CARES Act provides additional tax incentives to encourage charitable giving. You have important priorities for your family and loved ones, and we know that their health and financial well-being comes first.

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