Silver linings are hard to find this year, but it’s worth remembering that The Coronavirus Aid, Relief, and Economic Security (CARES) Act created important opportunities for your clients to increase their giving to charitable causes. Keep these three tools in mind as you are assisting clients with year-end tax planning: 

1. Even for taxpayers who take the standard deduction, a reduction in adjusted gross income is available for charitable contributions up to $300 per taxpayer. Donations to donor-advised funds don’t count; nonetheless, this deduction is a great way for clients to help their favorite organizations. 
2. Individuals who itemize deductions can elect to deduct donations up to 100% of their 2020 adjusted gross income instead of being capped at 60%. For corporations, the CARES Act increased the cap from 10% to 25% of taxable income. (Again, contributions to donor-advised funds and private foundations are not eligible.)
3. For many clients, the waiver of the Required Minimum Distribution for 2020 could create an economic incentive to redirect tax savings to charitable giving. And of course, nothing has changed about the rules for Qualified Charitable Distributions, which permit both itemizers and non-itemizers to direct up to $100,000 from an IRA to qualifying charities without triggering a taxable event.