Preservation | Family Wealth Protection & Planning


Blog Editors



Today is Giving Tuesday
By Jennifer Davis on December 1, 2020 at 11:30 AM

This holiday weekend, you may have tackled your holiday shopping with deals from Black Friday, Small Business Saturday and Cyber Monday. Now, you may wish to join Giving Tuesday and add charitable giving to finish your holiday shopping! 

This year, thanks to the CARES Act, there are unexpected benefits to your charitable gifts.

Even if you do not itemize your income tax deductions, you may wish to make a gift to your favorite charity again. This is because the CARES Act includes a provision for those claiming the standard deduction. Starting in the 2020 tax year, an individual is eligible to claim $300 for cash contributions to charities in addition to the standard deduction. Although the CARES Act does not specifically mention married couples filing jointly, if the deduction is per individual, the hope is that there is $600 charitable deduction for a married couple.

Individuals who itemize their deductions and make substantial charitable giving can be limited in the deductible amount available for charitable contributions made during a calendar year. These limits are typically determined by a percentage of the individual’s adjusted gross income (AGI). For individuals who itemize, the CARES Act removes the 60 percent of AGI limitation for qualifying cash contributions to public charities made in 2020. Taxpayers may now deduct up to 100 percent of their 2020 AGI for qualifying cash contributions.  Importantly, this applies only to contributions made up to Dec. 31, 2020.

For both charitable giving incentives, one must give cash, as it does not apply to donations of stock, real estate or other non-cash types of property (such as cars). Thus, these cash contributions are best made by check or credit card.

To take advantage of these benefits under the CARES Act, the contributions must be to public charities – not private foundations supporting organizations or donor-advised funds. For a sizable gift, it is a best practice to confirm whether the entity to whom a gift would be made is a public charity. 

Lastly, even though the CARES Act removed the requirement for many to take their Required Minimum Distributions.  You may still wish to make a Qualified Charitable Distribution to your favorite charity.  For individuals who are over 70½, with a Qualified Charitable Distribution, you can make a charitable donation up to $100,000 directly to your favorite public charity from your IRA without being taxed on the distribution.

Facebook Twitter LinkedIn Google+ Email

This website uses cookies to improve functionality and performance. If you choose to continue browsing this website, you consent to the use of cookies. Read our Privacy Policy here for details.