The recently passed CARES Act will help nonprofit organizations by encouraging charitable giving in 2020.
By providing a one-time increase in 2020 to the limit on tax deductions taken in connection with donations to 501(c)(3) nonprofit organizations, the legislation incentivizes individuals and corporations to pull forward charitable contributions planned in future years.
For taxpayers who itemize, the CARES Act enables the deduction of a much greater proportion of their charitable contributions. Specifically, the CARES Act increases the limitation on charitable gifts from 60% of adjusted gross income to 100%. For corporations, the limitation has been increased from 10% of taxable income to 25%.
For donors considering multiyear gifts in the future, this increased deduction for 2020 is designed to accelerate the timing of such contributions and provide immediate relief for organizations that are facing financial pressure due the pandemic.
As the Focused Ultrasound Foundation embarks on a $60 million campaign over the next five years to support its activities, we are encouraged by this change in the tax law and the effects it could have on our fundraising activities, particularly for 2020.
This information is not intended as legal or tax advice. If interested in learning how to take advantage of this tax benefit, Focused Ultrasound Foundation recommends consulting your attorney or tax advisor. Additional information can be found at the following websites: