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Charitable donations eligible for special tax benefits in 2021

The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) that was passed by Congress in 2020 has been extended through 2021. It includes several charitable tax provisions to encourage giving. Read below to learn how you can take advantage of these provisions in your 2021 charitable giving plans.

CARES Act Charitable Tax Provisions

  • Donors who do not itemize when filing their tax returns, but make a gift to charity, will be allowed to take a special tax deduction up to $300 ($600 for couples filing jointly) to reduce their tax liability.

  • Through 2021, donors who itemize when filing their tax returns can benefit from an increase in the deduction limit up to 100% of a donor’s adjusted gross income (AGI) for cash gifts. Previously, the deduction was capped at 60% of AGI. Therefore, donors who make a gift of cash will be able to deduct more this year.

  • IRA Qualified Charitable Distribution (QCD): At age 70½ or older, donors may make a gift of any amount, up to $100,000 per individual ($200,000 for couples with individual IRA accounts), from their IRA without paying income tax on the donated amount. For donors who have a Required Minimum Distribution (RMD), making a qualified distribution from their IRA will satisfy that requirement. 
    • Funds should be transferred directly from the donor’s financial institution to The UCLA Foundation.
    • The QCD can only be made from IRAs – not from company plans.
    • Donors who have personalized checks for their IRA account should contact UCLA’s Office of Gift Planning for specific information to ensure that their wishes are met.

While not affected by the CARES act, gifts from Donor Advised Funds are welcome and are a great way to make charitable contributions without affecting your financial security. If you are interested in learning more about any of these opportunities, please contact UCLA Office of Gift Planning: Phone: 800-737-UCLA (8252), Email: giftplanning@support.ucla.edu Visit: legacy.ucla.edu. 

For more information about how the CARES Act may impact your specific financial situation, please consult with your tax, legal, or financial advisors.