But ABWE serves a God who is steadfast and enduring, while even the most severe pandemics will dissipate.
During these trying seasons, ABWE is especially grateful for the unending support from our donors. Despite the financial hardships it’s beset, 2020 may be the best year to give due to the passing of the Coronavirus Aid, Relief, and Economic Security Act (the CARES Act). The new stimulus bill offers greater deductions for donations to qualified charities and nonprofits, including ABWE. Here is some information on the CARES Act that you should care about.
1. The Standard Deduction Has Changed
For standard deductions, the CARES Act introduced an above-the-line deduction for non-itemized, charitable donations. Individuals can claim up to $300, even if they aren’t itemizing for the 2020 tax year.
2. Itemized Deductions Have Changed
Under the CARES Act, exclusively for 2020, 100% of your adjusted gross income (AGI) can be deducted, as opposed to the usual 60% AGI cap. It has also boosted businesses’ AGI deduction limit from 10% to 25%.
For example, say Bob has an AGI of $100,000. In the past, he would normally only be able to deduct up to $60,000 for gifts to charity. But for the 2020 tax year, with the temporary changes in the CARES Act, Bob can now deduct his entire AGI of $100,000. Theoretically, this means that extremely benevolent givers could end up with zero taxable income.
3. The CARES Act is Different from Previous Tax Legislation
The CARES Act is designed to be fast-acting for all Americans, without stiff and rigid criteria that pose high barriers of entry. At the time of the CARES Act’s passing, the country feared for nonprofits, expecting they would be hit the hardest as donors pinched their wallets tighter this year. The government realized that these are invaluable organizations to effect change in times of crisis. It wanted to stimulate generosity in a difficult COVID-19 economy by providing some extra incentive for Americans.
When planning your financial stewardship, prayerfully consider capitalizing on the CARES Act. Our mission wouldn’t be possible without your generous giving. Contact your accountant or financial advisor for more information.
Editor’s Note: Lamar King, financial advisor for BARE Wealth Advisors, contributed to the writing of this article. ABWE is not a financial advisor. Please consult with your accountant.
This article was edited on December 23, 2020 to better reflect the specific itemization amounts. We originally published an additional $600 deduction for those married, filing jointly—which has been clarified by the IRS.
Each gift to the Global Gospel Fund allows ABWE to serve 1,000 missionaries with vital ministry resources, leadership, planning, care, and counseling, through a team of more than 70 experts—who also know them by name and are praying for them.