Members of Congress from both the Republication and Democrat parties have introduced legislation to expand the increased charitable deduction cap for non-itemizers to up to one-third of the standard deduction. The Universal Giving Pandemic Response and Recovery Act (S.618/H.R.1704) also extends this temporary $300 deduction, which was included in the original CARES Act, through 2022 and enhances the provision to include gifts to donor-advised funds. 

Preliminary reports suggest that the so-called “universal charitable deduction” is already showing signs of success in encouraging more people to give to charitable organizations. For example, The Association for Fundraising Professional (AFP)’s Fundraising Effectiveness Project reports a 28% increase of $300 gifts made on December 31, 2020, which is the precise amount of the maximum a non-itemizer can deduct. AFP also reports that gifts of $250 or less increased by more than 15% in 2020 compared with 2019.

The inclusion of donor-advised funds as qualified recipients of universal charitable giving is an important breakthrough and recognition that donor-advised fund vehicles are powerful tools to increase effective charitable giving. When paired with the expertise and resources uniquely available through CFAAC, a donor-advised fund can be a critically important component of the philanthropic strategy for an individual, family, or business.