Whether you are supporting natural disaster recovery, COVID-19 pandemic aid or another cause that’s personally meaningful to you, your charitable donations may be tax deductible. These deductions basically reduce the amount of their taxable income.
Here’s how the CARES Act changes deducting charitable contributions made in 2020:
Previously, charitable contributions could only be deducted if taxpayers itemized their deductions.
However, taxpayers who don’t itemize deductions may take a charitable deduction of up to $300 for cash contributions made in 2020 to qualifying organizations. For the purposes of this deduction, qualifying organizations are those that are religious, charitable, educational, scientific or literary in purpose. The law changed in this area due to the Coronavirus Aid, Relief, and Economic Security Act.
The CARES Act also suspends limits on charitable contributions and temporarily increases limits on contributions of food inventory.
If you have any questions regarding charitable contributions, please contact a member of the Crosslin tax team at (615) 320-5500. We are here to help!
