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The CARES Act and your Charitable Gift

Possible tax benefits for your contributions.

Did you know the CARES Act may still have additional tax benefits for you if you make a charitable gift this year?

The Act established several provisions that you may be eligible for, depending on how you file your taxes.

  • For tax payers who do not itemize: It allows taxpayers who utilize the standard deduction to take deductions on cash contributions up to $300 to organizations like ARL for the 2021 tax year.

  • For tax payers who itemize: It increases the charitable deduction amount from 60% to 100% of adjusted gross income (AGI), after this cap, additional contributions can be carried forward and deducted over the next five years.

However, these new benefits do have some restrictions:

      • Only cash gifts are eligible. This means gifts of stock, vehicles, land, or other goods will not qualify
      • Gifts to establish or to add to Donor-Advised Fund accounts do not qualify
      • Gifts must be made to public charities like ARL, as gifts to private foundations do not qualify

Updates to Required Minimum Distributions (RMD):
For most facing RMDs in 2021, you are still able to make qualified charitable distributions (QCD) up to $100,000 from your IRA in 2021 to charities like ARL in a tax-efficient manner.

Be sure to keep copies of your gift receipts as you may be required to substantiate your contributions. Always consult your financial advisors or a tax professional when seeking financial or tax advice.