As part of the CARES ACT, individuals can elect to deduct donations up to 100% of their 2020 adjusted gross income. Normally, you can only deduct up to 60%. The new deduction is only for gifts that go to a nonprofit organization. The higher deduction does not apply to gifts to private foundations or donor advised funds.
There are great tax benefits this year. If you take the standard deduction (meaning you don’t itemize), you can deduct up to $300 per taxpayer in charitable contributions. This adjustment will reduce your adjusted gross income, which reduces your taxable income. A donation to a donor advised fund does not qualify.
On Friday, March 27, the Coronavirus Aid, Relief, and Economic Security Act (CARES) was put into effect. It is a $2 trillion economic stimulus package that provides immediate relief to people like you and me.
You can donate to any nonprofit organization that is a registered 501(3)(c). Wisconsin Lutheran High School qualifies, along with all of our conference congregations. To make a gift to Wisconsin Lutheran, click here.
We encourage you to do your research. Visit home.treasury.gov/policy-issues/cares to read about the CARES ACT. Or, contact your financial planner/CPA for additional information on taking advantage of these tax benefits.