We all know that 2020 will be a year marked with an asterisk when referenced in history. As the year comes to a close, you may be wondering if you can still make a difference in the lives of current and future students through the Catholic Schools Foundation (CSF). In fact, your year-end gift can have a tremendous impact at this critical point in history, and year-end charitable contributions can bring substantial tax benefits. Giving in 2020 has some serious advantages and we’ve highlighted some of them below.
Simplicity of Outright Giving – The simplest ways to contribute to CSF is to write a check or use your credit card. Your cash gift is tax deductible if you itemize deductions. If you do not expect to itemize this year, you may be able to strategically “bunch” your contributions – for example, making both this year’s and next year’s contributions in the same year in order to maximize your tax benefits.
Special Tax Incentives for 2020 Only – Your outright contribution may be eligible for special tax incentives this year. Charitable contributions of cash are deductible up to 100% of your adjusted gross income (“AGI”) in 2020. Ordinarily, these contributions are limited to 60% of AGI. And, for 2020 only, if you do not itemize your deductions you are allowed to reduce your taxable income by up to $300 for cash contributions to charity.
Giving Appreciated Securities – You can double your tax benefits by contributing stocks or other securities that are now worth more than you paid for them. You will receive an income tax charitable deduction for the share price and you avoid the capital gains tax that you would have owed if you sold them. Most gifts of securities can be electronic transfer, but be sure to direct that the securities themselves be transferred to CSF.
IRA “Charitable Rollover” – If you are age 70½ or older, a Qualified Charitable Distribution (“QCD”) allows you to contribute up to $100,000 from your IRA to CSF with no tax on the withdrawal. And, your contribution counts toward your required minimum distribution without increasing your taxable income.
As always, your own advisers are in the best position to help you determine what would be most appropriate for you. We are available to work with you and your advisers as you consider gift options. Remember that some gifts can take longer to accomplish, so please be aware of timing if you are interested in meeting a year-end deadline.
