CARES Act Allows for New Deduction
The CARES (Coronavirus Aid, Relief, and Economic Security) Act is designed to help you, businesses, and nonprofits facing economic hardship during the coronavirus pandemic. See below for a few key CARES Act provisions that have been extended or updated as of the first of the year.
In addition to the support that it is bringing to individual households, here are some ways it may affect your charitable giving for the year:
- All non-itemizer taxpayers may take an "above the line" charitable deduction of up to $300 ($600 for couples). You might think that this is a small amount and would not make a difference but consider if all parishioners gave “just” $300. Such support would have a huge impact on our mission.
- For those who do itemize, the new law continues to all for cash contributions to qualified charities (like Church of the Redeemer) to be deducted up to 100% of your adjusted gross income for the 2021 calendar year.
- No waiver of RMD in 2021. The new year brings back the RMD for the 2021 tax year. An RMD is the annual Required Minimum Distribution that you must start taking out of your retirement account after you reach age 72 (70½ if you turned 70½ before Jan 1, 2020). Many of our parishioners use their RMD to make a gift from their IRA. This is commonly known as the “IRA Charitable Rollover” or Qualified Charitable Distribution (QCD). If you are 70 ½ or older, you can make a gift from your IRA (lowering your taxable income) or name Church of the Redeemer as a beneficiary, even if you are not required to make your RMD.
Reminder: More than 2/3 of Church of the Redeemer's operating budget comes directly from your financial commitment, you faithfulness and generosity.