Tax incentives in the CARES Act

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The Quad Cities community continues to be generous with its giving during the COVID-19 pandemic. At the Quad Cities Community Foundation, we are deeply committed to helping you act on your philanthropy in the best possible way—and receive the tax incentives that are available to you.

The CARES Act (Coronavirus Aid, Relief and Economic Security Act) that was passed earlier this year offers a variety of incentives to donors, no matter the amount of their giving. Here’s what you need to know:

  • Individuals who do not itemize and instead take the standard deduction on their federal income taxes may now deduct up to $300 in qualified charitable contributions of cash from their adjusted gross income in 2020. Normally, no deduction is permitted. This does not apply to gifts to donor advised funds.

  • Individuals may deduct cash gifts up to 100 percent of their adjusted gross income in 2020 (up from 60 percent). This provision only applies to cash contributions. Gifts to donor advised funds are not eligible.

  • The required minimum distributions from retirement accounts are suspended for 2020. However, individuals can still make a qualified charitable distribution of up to $100,000 from their IRAs. The direct distribution to charity would not be included in taxable income.

  • Corporations may deduct up to 25 percent of pre-tax income in 2020 (up from 10 percent).

 You charitable giving makes a world of difference—to the nonprofits you appreciate, to the Quad Cities Disaster Recovery Fund, and to the Community Foundation’s Quad Cities Community Impact Fund to address the greatest needs and most promising opportunities in our Quad Cities. To give online, click here.

If you have any questions, Anne Calder, vice president of development, is available to support your giving. Contact her at (563) 326-2840 or AnneCalder@QCCommunityFoundation.org.  

Ted Stephens III