A treat to boost 2021: Congress extends charitable giving incentives
As you reboot after a wild 2020, now is a great time to address your charitable giving plans for 2021. COVID-19 has proven to be a marathon, not a sprint. Nonprofit organizations will be relying on the generosity of donors for the foreseeable future to stay afloat and serve the people who need their programs.
Here are a few giving tips that can help make 2021 a better year for our community:
- Even non-itemizers should plan to make at least $300 in cash contributions to qualifying charities (and now $600 for non-itemizing joint filers) this year. The Taxpayer Certainty and Disaster Tax Relief Act of 2020, known as the Coronavirus Stimulus 2.0 bill, was passed by Congress on December 21, 2020 and signed by President Trump on December 28. The legislation extends the CARES Act’s temporary, above-the-line charitable deduction for contributions to qualifying public charities for tax year 2021.
- The Coronavirus Stimulus 2.0 bill also includes a one-year extension of the CARES Act’s provision increasing charitable deduction limits to 100 percent of AGI for contributions by individuals to qualifying charities. This creates an opportunity to work with your professional advisor on a charitable giving budget for 2021, especially to determine whether you can benefit from this incentive, or you would still be better off carrying forward charitable contribution deductions into future years.
For more information about how the extension of these CARES Act provisions may impact your specific financial situation, please consult with your tax, legal, or financial advisors or reach out to the Community Foundation for support organizing your giving to deploy it in a way that maximizes results for the causes you care about.