2020 CARES Act, Tax Deductions, and Year-End Giving

“If you’d like to support Acme Charities, please make a tax-deductible gift of . . . “


While it’s true that philanthropic contributions to 501(c)(3) organizations are tax deductible, what’s not clear is if stating that has any impact on a donor’s likelihood to give.


What is clear is that tax deductibility is not a case for support for your organization and donors are far more likely to give because of a compelling story and irresistible offer than they are because of tax status.


The 2020 CARES Act, though, does provide some extra incentive for donors this year.


And since I’m getting a lot of questions about what those provisions are and what they mean to charities, I sat down with Becky MacDonald and Diane Booth of Endowment Partners, along with Cherian Koshy, Director of Development at Des Moines Performing Arts, and asked the true experts . . .


Quick 18-minute listen/watch that will help you prepare for year-end and navigating the tax changes for 2020

Good and interesting stuff!
Quick re-cap:
– $300 Above-the-Line Deduction of $300 contribution to a charity for those who take the standard deduction;
– Charitable deduction limit increased to 100% of Adjusted Gross Income;
– No mandatory distributions from retirement accounts (i.e. IRA Rollovers, but with the increase to 100% AGI, that could work to a donor’s benefit);

If you need some more details or a document on the details, here are some great resources:

Quick word of advice – unless you are a CPA or financial professional, it’s probably best to begin all our discussions with donors, including in written materials, “Please consult with your tax professional.” When we, as charities and fundraiser say, “Your contribution is 100% tax-deductible as provided by law.” Unless you know the donor’s finances intimately, you don’t know if they’ve maxed out their benefits or have other financial situations that may limit that.


It’s a helpful tool and important information, pointing to good conversations to have with donors. And the best, most compelling, revenue-generating conversation is always going to be around a clear mission, presenting a problem the donor can solve, by telling a powerful story that touches the heart.
Posted in