The Consolidated Appropriations Act of 2021 has extended the 2020 CARES Act benefits that may impact your gift to the A.R.T. in 2021!
Universal Deduction for Donations
For individual taxpayers that take the standard deduction, the CARES Act will allow above-the-line deductions of contributions up to $300 on your 2021 federal tax return.
If you are married-filing-jointly, taxpayers will get the above-the-line deduction up to $600.
Raising the Charitable Giving Deduction Cap
For individuals and joint filers who are able to itemize their deductions, the deduction cap of 60% is increasing to 100% of adjusted gross income.
For corporations, the law raises the annual limit from 10% to 25% of taxable income.
Each person or married couple should consult with their own professional legal or financial advisor for the most accurate, up-to-date information to ascertain how the opportunities below may complement their own personal, philanthropic, and tax-planning objectives.
The CARES Act Fine Print for Gifts
Gifts must be made to a 501(c)(3) public charity (like the A.R.T.!).
Gifts must be made in cash to qualify and does not apply to those made to donor advised funds.
Gifts must be made in 2021.
Standard Deduction Only
Gifts made are eligible for the above-the line deduction in addition to the standard deduction.
Charitable Giving Deduction Cap Only
Gifts must be made in cash to qualify for the 100% of AGI deductibility. The limit for gifts of property is unchanged as a result of The CARES Act.
Is this a permeant change to tax incentives for charitable giving?
No. Gifts must be made in 2021.
Do the gifts have to be applied to a COVID-19 Emergency Fund?
The donation does not have to be related to COVID-19 relief efforts.