Impact of CARES Act on Charitable Giving

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The Coronavirus Aid, Relief, and Economic Security, or CARES, Act was signed into law by President Trump on March 27.

It’s important to speak with a trusted adviser to consider how the CARES Act affects your individual situation. At least four provisions of the Act might be relevant to Burnett Society members and others who provide charitable support to nonprofit organizations.

  • The CARES Act eliminates required minimum distributions from traditional IRAs, 403(b) and 401(k) plans for 2020. Individuals age 70½ and older can still make a tax-advantaged qualified charitable distribution of up to $100,000 from their traditional IRA to benefit their favorite charities. Contact us if you’d like to make a qualified charitable distribution to the University of Nebraska Foundation. We will work with you and your advisers to ensure the gift is administered properly.
  • Those who do not itemize deductions on their federal tax return will be entitled to deduct up to $300 in cash donations to charities during the 2020 calendar year.
  • Itemizers will be allowed to deduct cash charitable contributions up to 100% of adjusted gross income in 2020. Cash contributions were previously limited to 60% of AGI with a five-year carry forward period for deductions above the limit. In 2020, a donor with an AGI of $100,000 could make a $100,000 charitable gift and deduct the full amount from their taxable income. In prior years, that same donor would have been able to deduct only $60,000 while carrying the other $40,000 forward to be used as a charitable deduction in a subsequent year.
  • The deduction limitation for cash contributions by corporations has increased from 10% to 25% of taxable income for 2020.

For more information about the CARES Act, contact the foundation’s gift planning department at gift.planning@nufoundation.org or 800-432-3216.

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