One good thing about 2020 – the CARES Act
Deduction Expires 12/31/2020
On March 27, 2020, the CARES Act was signed into law. Unlike 2019, when your charitable contributions were generally useless from a tax perspective, the CARES Act changed that. How?
1. Even if you don’t itemize, you may be able to deduct up to $300 in annual charitable contributions this year. It is an “above the line” adjustment to income that will reduce a donor’s adjusted gross income (AGI), and thereby reduce taxable income.
2. Even individuals and corporations that itemize can benefit. Individuals can elect to deduct donations up to 100% of their 2020 AGI (up from 60% previously). Corporations may deduct up to 25% of taxable income, up from the previous limit of 10%. Act now!! The CARES Act may not be extended to 2021.