The CARES Act and You
As LGBTQ people continue to be disproportionately impacted by the devastating effects of the COVID-19 pandemic, we are seeing more and more philanthropic-minded individuals step up to meet our community’s needs. The recently enacted CARES Act has several components built in to encourage charitable giving to nonprofits. These items may impact your own philanthropic decision making, including how you support Stonewall and the many organizations keeping our community strong. We’re here to break a few of these items down for you:
A waiver on the 60 percent AGI limit for contributions to public charities, with the exception of donor advised funds. According to the New York Times:
According to the New York Times: As part of the bill, donors can deduct 100 percent of their gift against their 2020 adjusted gross income. If you have $1 million of income, you can give $1 million to a public charity and deduct the full amount in 2020. The new deduction is only for cash gifts that go to a public charity. If you give cash to, say, your private foundation, the old deduction rules apply. And while the organizations that manage donor advised funds are public charities, you do not get the higher deduction for donating cash to your donor-advised fund*. If your assets are substantial enough that you can give more than your income this year, you won’t lose the deduction for the excess amount. You can use it next year, as has always been the case.
*Note: gifts to other types of funds, like our general operating fund or Emergency Response Fund, are eligible for the waiver.
A $300 above-the-line deduction. For those folks who take the IRS Standard Deduction and donate $300 to qualified organizations, the deduction for 2020 will be up to $12,300 for Single or Married Filing Separately, and up to $24,600 for Married Filing Jointly. There are additional standard deductions for those over 65 years old ($1,300 or more.)
An increased percent of taxable income limitation on charitable contributions for C corporations. The standard 10 percent of taxable income limitation on charitable contributions for C corporations has been increased to 25 percent for cash contributions for the entirety of 2020.
If you would like to support the LGBTQ organizations, both large and small, that have urgent needs, please consider donating to Stonewall’s Emergency Response Fund. Your gift will help fuel the work of nonprofits serving the most physically and economically vulnerable as a result of this pandemic.