Year-End Tax Savings Tips for Charitable Giving in 2020
If your donation is received on or before December 31, 2020 (checks need to be postmarked by Thursday, December 31), you will receive a donation receipt that may help reduce the amount of income tax you owe this year, inshaAllah.
Here are some helpful charitable giving tips and reminders for 2020. As always, please consult your tax advisors before finalizing your plans.
CARES ACT Tax Benefits – Available in 2020 only!
- Individuals who claim the standard deduction, may be able to deduct up to $300 for cash charitable contributions made to qualified 501(c)(3) charities during 2020! This “above-the-line” deduction of up to $300 lowers both adjusted gross income and taxable income – translating into tax savings!
- For individuals who itemize their deductions, you may deduct up to 100% of your Adjusted Gross Income (AGI) for cash charitable contributions to qualifying 501(c)(3) charities. So, if your 2020 AGI is $200,000, you can deduct $200,000 in charitable donations!
- For corporations, you are eligible for a deduction of up to 25% of your taxable income for charitable contributions made to qualifying 501(c)(3) charities.
Please take advantage of the above savings as they may not be available in future years!
Please check with your employer to see if they will match your donation to iCN. This is a great opportunity to increase your donation. To take advantage of this opportunity, please contact your employer.
Don’t sell your stocks – instead, consider gifting stocks and other appreciated assets to ICN for potential savings of income and capital gains taxes. Donating your stocks directly to a charitable organization will result in a greater charitable donation and savings of taxes.
All stock transfers must also be completed by Thursday, December 31 to be counted for tax purposes for 2020. The above is for informational purposes only and should not be construed as or relied upon as legal or tax advice.
Here are the details you need on ICN’s Stock Donation Account:
- Name of the organization account is opened under: ISLAMIC CENTER OF NAPERVILLE
- Name of the Financial Institution: TD AMERITRADE
- Account number for the organization at the financial institution: 493-376-575
- DTC code for the Financial Institution: 0188