CARES Act Charitable Giving Provisions Extended Through 2021

February 2, 2021

By George Dulgeryan, Senior Development Officer and William Strickland, Planned Giving Officer

On March 27, 2020, the $2 trillion Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted and in acknowledgement of the essential role that nonprofit organizations play during the COVID-19 outbreak, it provided individuals and corporations with tax incentives for charitable giving (learn more about those provisions in our previous CARES Act: Charitable Giving Incentives article).

On December 27, 2020, the Consolidated Appropriations Act, 2021 was enacted, in part, to extend Covid-19 relief in connection with provisions set forth in the CARES Act, thereby prolonging the charitable giving tax incentives through December 31, 2021.

First, individual taxpayers who do not itemize their federal income tax deductions are allowed to take a universal charitable deduction for cash contributions to qualifying public charities of up to $300 for a single individual and $600 for a married couple filing jointly. Donations to donor advised funds or supporting organizations are not eligible for this tax benefit.

Second, the increased deductibility limitation for individuals (100% of AGI) and corporations (25% of taxable income) is also extended through December 31, 2021. As with the previous law, this only applies to cash contributions and the deduction is not available for contributions made to donor advised funds or supporting organizations.

If you have any questions about charitable giving and the application of the provisions within the CARES Act discussed above, please contact William Strickland, JD, CSPG and George Dulgeryan, JD, LLM, CSPG at (213) 413-4130.

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