SUMMER 2021

Congress Extends Charitable Giving Incentives In 2021

COVID-19 has proven to be a marathon, not a sprint. For the foreseeable future, many nonprofit organizations will be relying on the generosity of donors to stay afloat and serve the people who need their programs.

Consider dropping a quick note to clients for whom philanthropy is a priority, and share the tips below that can help make 2021 a better year for our community: 

1. Even non-itemizers should plan to make at least $300 in cash contributions to qualifying charities (and now $600 for non-itemizing joint filers) this year. The Coronavirus Stimulus 2.0 bill, which was signed into law in December, extends the CARES Act’s temporary, above-the-line charitable deduction for contributions to qualifying public charities for tax year 2021. 
2. The Coronavirus Stimulus 2.0 bill also includes a one-year extension of the CARES Act’s provision increasing charitable deduction limits to 100% of AGI for contributions by individuals to qualifying charities. This creates an opportunity to work with your clients on a charitable giving budget for 2021, especially because you’ll want to run calculations to determine whether a client can benefit from this incentive or would still be better off carrying forward charitable contribution deductions into future years.
3. Given the extensions included in the Coronavirus Stimulus 2.0 bill, coupled with the general uncertainty about potential tax reforms under the Biden administration, it is wise to counsel your clients about being especially organized about charitable giving in 2021. Clients will want to be even more conscientious about the impact of dollars invested in the community, too.

While the provisions outlined above do not include gifts to donor-advised funds, they do apply to all other charitable fund types HCF offers, including designated, scholarship and field-of-interest funds.

To learn more, contact Jen-L W. Lyman, Director of Planned Giving & Advisor Relations, at (808) 566-5596 or jlyman@hcf-hawaii.org. We’re always available to answer your questions about philanthropy or schedule a personal consultation with you and your clients.