As your clients reboot after the whirlwind of 2020, now is a great time to address their charitable giving plans for 2021.

As your clients reboot after the whirlwind of 2020, now is a great time to address their charitable giving plans for 2021. COVID-19 has proven to be a marathon, not a sprint. Nonprofit organizations will rely on donors' generosity for the foreseeable future to stay afloat and serve the people who need their programs.

Consider dropping a quick note to clients for whom philanthropy is a priority, sharing a few tips to 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 Taxpayer Certainty and Disaster Tax Relief Act of 2020, known as the Coronavirus Stimulus 2.0 bill, was passed by Congress on December 21, 2020, and signed by President Trump on December 28. The legislation extends the CARES Act's temporary, above-the-line charitable deduction for contributions to qualifying public charities for the 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 percent 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. Plus, this will help you run calculations to determine whether clients can benefit from this incentive or whether a client 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 with charitable giving in 2021. Clients will want to be even more conscientious about the impact of dollars invested in the community, too.

As always, we would be pleased to assist you and your clients. Donor advised funds and other planning vehicles through the Community Foundation can help your clients arrange their giving and deploy it in a way that maximizes results for their favorite causes.