CARES Act (2020) and Consolidated Appropriations Act (2021) Tax Incentives for Seacrest Foundation Contributors
For those who have already donated to the Seacrest Foundation Covid-19 Emergency Fund, as well as those considering a contribution, there are some important new tax incentives as a result of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act, 2020) extended into tax year 2021 by the Consolidated Appropriations Act, 2021 of which you should be aware:
- New in 2021 is an additional “above-the-line” deduction for those married filing jointly. Joint filers (who aren’t itemizing) will be allowed to take an above-the-line deduction of up to $600 in cash contributions to charity this year.
- Taxpayers who don’t itemize may now deduct up to $300 per year in charitable contributions. Since this is a universal “above-the-line” deduction, taxpayers don’t have to file Schedule A (itemize) to claim it. Instead, taxpayers list it as an adjustment to income on Schedule 1 of Form 1040 and then deduct it from their gross income (along with all other adjustments to income) on the first page of their Form 1040. Such deductions must be:
- in cash (no property like old clothing)
- given to a 501(c)(3) public charity
(Exclusions: Contributions to non-operating private foundations, support organizations, and donor advised funds.)
- Limitations are lifted on charitable contributions by individuals who itemize from 60% of adjusted gross income to 100% of taxable income. They may also choose to carry forward any unused deductions for up to five years. (Donations to donor-advised-funds would not qualify.)
- If you are over age 70 1/2 you may still benefit greatly from tax-free Qualified Charitable Distributions from your IRA. (Up to a maximum of $100,000.)
- Charitable deductions by a corporation will see an increase from 10% to 25% of taxable income for 2020. (Charitable food contributions will increase from 15% to 25%.) Donations in excess of 25% may be deducted in the following five years.
Please consider a gift to help the most vulnerable among us, the residents of Seacrest Village and the clients of Seacrest at Home, along with our staff who are on the front-lines caring for them around the clock to keep them safe and healthy.
Be safe and well,
Robin P. Israel, MPA
Chief Foundation Officer
Arthur & Sophie Brody Philanthropy Chair