Implications of the Consolidated Appropriations Act, 2021

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You might be wondering what to expect from the recently enacted Consolidated Appropriations Act of 2021. Some of the key provisions that relate to the charitably inclined include extensions of several provisions of the CARES Act into 2021, which are as follows:

  • As in 2020, now through the end of 2021 you can take an income tax deduction for charitable contributions of cash of up to 100% of your adjusted gross income.
  • Similar to 2020 but with a slight change, non-itemizers can reduce their taxable income (rather than AGI) by making cash gifts to public charities. Joint filers can deduct a maximum of $600, and single or married couples filing separately can deduct up to $300.
  • Again as in 2020, corporations may deduct up to 25% of their taxable income with a gift of cash or food inventory to a public charity.

As of note and unlike 2020, required minimum distributions (RMDs) will need to be taken from most retirement plans in 2021 based on certain age requirements. Specifically, RMDs must be taken starting at age 72 (or at age 70½ if you turned 70½ before January 1, 2020).