On March 25 the Senate approved a $2 trillion aid package (HR 748) to address the economic fallout from the COVID-19 (Coronavirus) pandemic by a 96-0 vote. The bill, which is the third legislative relief package to address COVID-19, now goes to the House where Speaker Pelosi has said it will be taken up Friday “with strong bipartisan support.” President Trump has indicated he will promptly sign the measure into law when he receives it.

While there are numerous provisions in the 880-page bill that will provide significant funding for and otherwise benefit certain members of the nonprofit sector, two sections of the legislation were included specifically to increase charitable giving during these tumultuous times.

• Section 2204 provides for a very modest and temporary above-the-line deduction for charitable contributions for 2020. The legislation would permit all taxpayers, regardless of whether they itemize or not, to deduct up to $300 of cash contributions.
• Section 2205 modifies the AGI limitations on charitable contributions for 2020. For individuals, the adjusted gross income limitation is suspended for 2020. For corporations, the 10 percent limitation is increased to 25 percent of taxable income. This provision also increases the limitation on deductions for contributions of food inventory from 15 percent to 25 percent.

Text of the legislation can be found here. A summary can be found here.

As we all well know, COVID-19 is having, and will continue to have, a profound impact on the United States economy and has greatly expanded the need for charitable organizations to provide additional services in an unprecedented manner. Individual charities already have lost millions of dollars in revenue and an economic downturn will undoubtedly result in a further decrease of resources. While CGP is appreciative the above-referenced provisions were included the legislation and views it as a recognition from leaders on Capitol Hill about the urgent need to increase charitable giving, we believe the bill simply does not go far enough as charities desperately need additional funds to maintain operations, expand their scope to address increasing demands, and stabilize losses from closures throughout the country.

Lawmakers and Congressional staff are already beginning to conceptualize a fourth COVID-19 relief package, and CGP will continue to work with Congressional leaders and its partners in the nonprofit sector to enact a more expansive above-the-line charitable deduction as well as other important charitable giving incentives as part of any forthcoming legislation.

Due to these fast-moving developments, CGP will host an advocacy update conference call on Thursday, April 2 at 11 a.m. ET, free to anyone who registers. You can register for the call here.