The CARES Act – Good News for Donors

The CARES Act, signed into law on March 27, includes provisions that affect both individual and corporate donors.

The COVID-19 crisis has produced many unprecedented situations in our nation.   While many of those situations are adverse – you may not know that with the CARES Act there are great benefits and incentives that can stretch your charitable giving.

  • Gifts up to $300 are now 100% deductible even for those using the standard deduction. This means that you can deduct up to $300 whether you itemize your deductions or not.  Contributions by cash, credit card, or check are eligible; however, gifts of stock are not.

  • Maximum deduction is raised to 100% — Previously individuals could deduct up to 60% of their adjusted gross income (AGI) for charitable deductions of cash (not gifts of stock). The stimulus package allows individuals to deduct up to 100% of their AGI in 2020.  This is helpful for donors making major gift donations and makes it possible to eliminate federal tax burden entirely.  In addition, donations in excess of AGI may be carried over for up to five additional years.

  • Corporations have greater incentive to make charitable gifts. Previously charitable giving for a corporation has been limited to 10% of taxable income.  The limit has been increased to 25% of taxable income, making charitable gifts more attractive to business donors. 

Disclaimer: City Union Mission does not provide legal, tax, financial or other professional advice. You should consult professional advisors concerning the legal, tax, or financial consequences of your charitable activities or the CARES Act.

The following links are a few sites you can visit for more information:

Charity Navigator

Greater Kansas City Community Foundation