Take Advantage of 2020 Tax Incentives
We made it! The end of 2020 is here and we want to celebrate by sharing some good philanthropic news with you. The 2020 CARES Act includes several provisions designed to encourage charitable giving that we want you to know about. We encourage you to take advantage of these tax incentives in 2020 and support Denver Sister Cities International.
Universal Deduction for Donations Up to $300
The CARES Act grants taxpayers an above-the-line deduction for up to $300 in charitable donations starting in 2020. Married-filing-jointly taxpayers will get an above-the-line deduction of up to $600. Normally, you must itemize deductions to get a tax write-off for charitable donations.
Required Minimum Distributions Suspended but a Gift from your IRA may still be a Good Idea
The new law temporarily suspends the requirements for required minimum distributions (RMD) for the 2020 tax year. This probably comes as a relief to many of you who would have had to withdraw from your retirement accounts. Despite the RMD suspension, remember that if you are 70½ or older, you can still make a gift from your IRA or name Denver Sister Cities International as a beneficiary.
- Your gift will be put to good use today, allowing you to see the differences your donation is making.
- You pay no income taxes on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your deductions.
- Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.
Raising the Charitable Giving Deduction Cap
The law also lifts the existing cap on annual contributions for those who itemize, raising it from 60 percent of adjusted gross income to 100 percent. For corporations, the law raises the annual limit from 10 percent to 25 percent.
Donate Gifts of Appreciated Securities
By giving appreciated securities you have owned for more than a year, you enhance your tax benefits. You receive a tax deduction for the value at the time of your gift, and you avoid the capital gains tax that you would have owed if you sold the stock.
Denver Sister Cities International is a 501(c)(3) tax exempt organization and our EIN is #84-6032193
- Consider accelerating 2021 gifts into 2020 to take full advantage of these one-time tax law changes.
- You may make a charitable contribution online www.denversistercities.org
The tax information provided is general and educational in nature. DSCI does not provide legal or tax advice. Always consult a tax professional regarding your tax situation