At the end of 2020, Congress passed a second stimulus package in response to the COVID-19 pandemic. This new stimulus package extends many of the charitable giving provisions outlined in the original Coronavirus Aid, Relief, and Economic Security (CARES) Act.
Here’s what the new stimulus package means for you:
- An expansion of the universal charitable deduction for cash gifts
The universal charitable deduction has not only been extended but given a well-deserved upgrade. The new deduction is $300 for single filers and $600 for married couples filing jointly. This is available to taxpayers who take the standard deduction. This tax incentive is available for cash gifts to qualified charities (but not to supporting organizations or donor advised funds). - An extension of the cap on deductions for cash contributions
Contributions to public charities are generally limited to a percentage of a taxpayer’s adjusted gross income. The CARES Act lifted the cap on annual contributions for those who itemize, increasing it from 60% to 100% of AGI for 2020 and now for 2021. Any excess contributions available can be carried over to the next five years. For corporations, the law raised the annual limit from 10% to 25% of taxable income.
We can help with your charitable goals:
We are deeply grateful for your continued kindness and support during this difficult time. Please contact MSU Office of Gift Planning at giftplan@msu.edu or 800 232-4678 | 517 884-1000 to discuss how your gift can help further our mission.