How to maximize your charitable giving in 2020

On March 27, 2020 new income tax legislation known as the CARES Act, became law. Officially named the Coronavirus Aid, Relief, and Economic Security Act, it was a stimulus bill designed to rescue the economy from the effects of the coronavirus pandemic. Contained in the bill are several tax benefits you can use in 2020 when you make your year-end gift to FIRST SERVE NEW MEXICO.

If You Are A Non-Itemizer
You can claim a charitable deduction of up to $300 for cash donations made by December 31, 2020. Even if you take the standard deduction rather than itemizing deductions you can benefit from this provision of the CARES Act in 2020.

If You Itemize Deductions – Higher Deduction Limits
The CARES Act provides higher deduction limits for individuals who itemize in 2020. You will be able to deduct cash gifts of up to 100% (normally 60%) of your entire adjusted gross income.* Consult your tax advisor to explore how you might benefit from making cash gifts to FIRST SERVE NEW MEXICO in 2020 this provision of the CARES Act makes it possible to reduce or eliminate federal tax liability in 2020 by making cash gifts.


No Required Minimum Distributions in 2020
If you are 70½ or older you can still make charitable gifts from your IRA, even though for tax year 2020, you are not required to take mandatory distributions from retirement accounts. The total annual limit on such gifts remains at $100,000. If you itemize deductions, consult your tax advisor about whether it makes sense for you to take advantage of the higher deduction limits, withdraw from your IRA, and then contribute a larger amount to FIRST SERVE NEW MEXICO, with the deduction offsetting the taxable withdrawal.

* Gifts of stock, real estate, personal property or to donor advised funds or private foundations do not benefit from this provision.