In response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security (CARES) Act offers a charitable deduction for up to $300 in donations to taxpayers who do not itemize their returns. The goal is to help groups and nonprofits affected by the coronavirus and the economic crisis.

Here’s What You Need to Know

  • The deduction applies to the 2020 federal tax return. Taxpayers who have not filed their 2019 tax return cannot claim it this year. It is unclear whether it will extend to future years.
  • Only cash gifts are eligible for the $300 deduction. Gifts-in-kind such as food, clothing and vehicles do not apply.
  • Married-filing-jointly taxpayers will get an above-the-line deduction of up to $600.
  • The adjustment is available for gifts to qualified public charities, including Denver Rescue Mission. Gifts to a donor advised fund (DAF) or gifts to supporting organizations, such as charities that are set up to support nonprofits, do not qualify. 

For donors who do itemize their deductions and directly write off charitable gifts, the current deduction cap is 60 percent of adjusted gross income. Corporations can deduct charitable donations up to 10 percent of taxable income. The CARES Act lifts these caps to 100 percent for individuals and joint filers and 25 percent for corporations for the 2020 tax year.

We cherish your continued support in this challenging time!

Disclosure: This information is not financial advice. Consult with a licensed professional for tax advice concerning your specific situation.