Collaborating With Advisors To Help Philanthropists Utilize CARES Act Tax Incentives

April 6, 2020
The new CARES Act includes more than $2 trillion in economic federal relief as well as tax incentives for charitable giving to help the U.S. face the coronavirus crisis.

Your clients who want to do more to help the community they love during this unprecedented crisis may be unsure if this is the right time to act.

The new tax incentives offered in the CARES Act for 2020 make this a perfect time for more charitable giving. And the Community Foundation of Broward is uniquely qualified to help you make the most of this opportunity to amplify your clients’ philanthropy.

You should know:

  • Gifts to donor-advised funds and gifts to private foundations are not eligible for CARES Act tax incentives.
  • The Community Foundation of Broward offers several types of charitable Funds that are eligible for the new law’s tax incentives.

Here are examples of endowed charitable Funds at the Community Foundation that your clients can create, or add to, that qualify for the CARES Act’s extraordinary tax incentives:

  • Unrestricted Endowed Fund for Broward: Your client helps tackle Broward’s big challenges today and those that emerge in the future. We deploy support from your client’s Fund where it can make the most impact in our community. This type of Fund offers the most flexibility in grantmaking.
  • Field of Interest Fund for Broward: Your client’s Fund supports a particular issue (health, education, environment, arts, etc.) that’s close to their heart. During times of crisis and beyond, your client’s Fund can respond with help for our community that reflects your client’s values, passions and goals for that issue.
  • Designated Fund: Allows your client to focus grantmaking to specific charitable organizations. Your client can be assured that their favorite organizations will have a permanent revenue stream to support their missions in good times and bad.

CARES Act tax incentives include:

  • Cash gifts to public charities in 2020 can be tax deductible up to 100 percent of adjusted gross income. That means your client’s gifts could enable them to pay no federal income tax for 2020.
  • Non-cash gifts, e.g. securities, can still be deducted up to 30 percent of adjusted gross income and cash gifts can make up the balance to reach the total of 100% benefit allowed in 2020.
  • Those who give more than their taxable income in 2020 can carry forward unused cash gift deductions for up to five years.
  • While the new law waives required minimum distributions from most retirement plans during 2020, your clients can still make charitable contributions of up to $100,000 from their IRAs without it affecting their taxable adjusted gross income. (Gifts from an IRA to create or add to Unrestricted Endowed, Field of Interest or Designated Funds at the Community Foundation meet the criteria for qualified charitable distributions.)

The CARES Act creates an extraordinary opportunity for your clients. And by giving through the Community Foundation of Broward, your clients can have the peace of mind of knowing that their support goes where it’s needed the most to tackle Broward’s Issues That Matter.  

Through the power of their endowed Fund, your clients will create bold and timely impact for their community today and forever.

Information about the CARES Act provided by PG Calc Blog, www.pgcalc.com.

Contact Information

Let’s talk about how the Community Foundation can work with you to help your clients create a lasting impact. You can contact Mark Kotler, Senior Director of Philanthropic Services, at mkotler@cfbroward.org or 954-761-9503, ext. 130.

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