Americans have access to a new tax incentive this year when making a donation to qualifying charities, including United Way of the Battle Creek Region and many of our local nonprofit partners.
The federal relief stimulus under the CARES Act allows taxpayers to claim an additional $300 deduction on their taxes without itemizing. The universal tax break will go into effect starting with the 2020 tax year. This is an above-the-line charitable income tax break, meaning that if you don’t itemize and instead take the standard deduction ($12,400 for individuals and $24,800 for married couples filing jointly), you’d receive a tax break for cash donations up to $300 in addition to the standard deduction.
If you do itemize deductions, there are now new charitable deduction limits. The CARES Act increased the existing cap on charitable cash contributions for those who itemize, raising it from 60% of adjusted gross income to 100% in 2020.
If you’re in a solid financial position and want to help those who aren’t, now is a great opportunity to take advantage of these new tax deductions. Please consider a gift to United Way to help local organizations provide critical services to the Battle Creek and Kalamazoo communities during this health and economic crisis.
