On March 27, Congress passed and the President signed into law the Coronavirus Aid, Relief, and Economic Security (CARES) Act. This law provides unprecedented support for nonprofit organizations and is the largest stimulus package in U.S. history.
Here are some important updates to tax deductions, effective for contributions made in the calendar year 2020:
- Standard deductions: Tax deduction of up to $300 per taxpayer ($600 for a married couple) in annual charitable contributions for people who claim the standard deduction when filing taxes.
- Itemized deductions: Individuals who itemize their taxes are now able to deduct up to 100% of their charitable contributions in 2020, rather than the previous 60% limitation.
These tax incentives apply to cash contributions only and do not apply to contributions to a supporting organization, a Donor Advised Fund (DAF) or a carryover contribution. Please reach out to an attorney or financial advisor for official legal or tax advice.