CARES Act and how it may impact your giving

The CARES Act (Coronavirus Aid, Relief, and Economic Security Act) suspends an annual required minimum distribution (RMD) for IRAs in 2020. This includes:

  • RMDs for those who reached age 70½ on or before Dec. 31, 2019, and would be required to take their first RMD by April 1, 2020. 
  • It also includes RMDs from inherited IRAs for 2020. 
  • If you regularly contribute through your IRA, you can still elect to take RMD as a qualified charitable distribution. 

The CARES Act includes a new above-the-line universal charitable deduction of $300 for all taxpayers. The goal is to encourage increased giving during a time of great need. The legislation also increases the annual limit on cash gifts for individuals who itemize, from 60% to 100% of adjusted gross income for 2020. The revised universal charitable deduction and cash contribution/AGI provisions do not apply to supporting organizations or donor advised funds. We suggest consulting with your financial advisor if you have questions.