The Coronavirus Aid, Relief, and Economic Security (CARES) Act was passed by Congress and signed into law by the president on March 27th, 2020. The CARES Act contains some provisions related to charitable giving.

The national accounting and consulting firm, CapinCrouse, that specializes in serving nonprofit organizations, highlights the key provisions of the CARES Act on their website. Several provisions are related to charitable giving and the use of personal savings:

  • “Above-the-line” Charitable Contribution Deduction for Non-itemizers
    • “For 2020 only, taxpayers who do not itemize their deductions may claim a charitable contribution deduction of up to $300 for the taxable year for cash contributions made to a public charity that is not a supporting organization or donor-advised fund. This new provision does not permit an above-the-line deduction for unused charitable contributions carried forward from a prior year.”
  • Modification of Charitable Deduction Limit
    • “The CARES Act also expanded the limit on the deductibility of cash contributions made by individuals to a public charity during 2020 from 60% of adjusted gross income to 100% of adjusted gross income. The limit for noncash contributions remains at 30% of adjusted gross income.”
    • “The limit on the deductibility of corporate contributions of cash made during 2020 is increased from 10% of net taxable income (before taking into account charitable contributions) to 25%. The limit for noncash contributions made by a corporation remains at 10%.”
  • Waiver of Required Minimum Distributions
    • “The CARES Act temporarily (for 2020) waives required minimum distributions from a 401(k) plan, a 403(b) plan, a governmental 457(b) plan, or an individual retirement plan (an IRA).”

The modification of charitable deduction limit presents an excellent opportunity for people considering a significant gift, such creating a permanent endowment from appreciated stocks, for example. Download this tri-fold brochure for more information on funding an endowment.

Would you like to learn more? Contact the Foundation’s president, Rev. Chris Walters, for more information: cwalters@umfnic.org or 312-334-0703. All inquiries are treated with complete confidentiality.

(This information is not intended as tax, legal or financial advice. Gift results may vary. Consult your personal financial advisor for information specific to your situation.)

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