Beneficial changes in federal tax law for Strings donors in 2020
The CARES Act— the Coronavirus Aid, Relief, and Economic Security Act— is a $2.2 trillion stimulus plan that includes enhanced charitable giving incentives for donors to Strings in the 2020 calendar year. The following summary of key provisions is not intended to provide legal advice. Please consult your tax advisor for additional information.
Enhanced Charitable Giving Incentives
• Temporary Universal Charitable Deduction— Households that do not itemize can take a one-time deduction of up to $300 for gifts made to charitable organizations including Strings. The deduction is only for gifts of cash made in calendar year 2020 and does not cover other types of gifts or contributions made to donor-advised funds or private foundations.
• For households that itemize, the Act suspends the 60% adjusted gross income (AGI) limitation on charitable contributions for the year 2020. In a typical year, individuals can only take a charitable deduction of up to 60% of their AGI, no matter how much they give. For 2020 there is no limit, making cash contributions fully deductible.
• For corporate gifts: The Act increases the cap on how much corporations may deduct for charitable gifts from 10% of taxable income to 25%.