Beyond an investment from your heart, a donation to RMHC can also be a financial benefit come tax time.
Some considerations to ensure you get the maximum benefit from your generous donation:
As a nonprofit corporation, Ronald McDonald House Charities of the Bluegrass (RMHC) is classified by the Internal Revenue Service as exempt under IRC Section 501(c)(3) and as a public charity under IRC Section 509.
- Keep records of your donations, including receipts or letters from RMHC acknowledging receipt of your donation. For your convenience, we will mail a tax receipt combining all of your financial donations for the prior calendar year to you in February.
- Donations of more than $250 must be supported by record of payment from your bank (Canceled check, bank statement, etc.).
- Generally, no more than 50 percent of your adjusted gross income can be deducted. If you donate more, carry that undeductable amount over into the next year.
TAX BENEFITS OF THE CARES ACT
The new CARES (Coronavirus Aid, Relief, and Economic Security) Act is designed to help you, businesses and nonprofits facing economic hardship during the coronavirus pandemic.
Here are a few key provisions of the CARES Act that may affect you and your charitable goals:
REQUIRED MINIMUM DISTRIBUTIONS SUSPENDED
The new law temporarily suspends the requirements for required minimum distributions (RMD) for the 2020 tax year. This probably comes as a relief to many of you who would have had to withdraw from your retirement accounts. Many donors use their RMD to make a gift from their IRA. Despite the RMD suspension, remember that if you are 70½ or older, you can still make a gift from your IRA or name Ronald McDonald House Charities of the Bluegrass as a beneficiary.
Why a Gift From Your IRA May Still Be a Good Idea
Your gift will be put to use today, allowing you to see the difference your donation is making.
You pay no income taxes on the gift. The transfer generates neither taxable income nor a tax deduction, so you benefit even if you do not itemize your deductions.
Since the gift doesn’t count as income, it can reduce your annual income level. This may help lower your Medicare premiums and decrease the amount of Social Security that is subject to tax.
NEW TAX INCENTIVES
The CARES Act expands charitable giving incentives and allows taxpayers who take the standard deduction to make up to $300 of charitable contributions to qualified charities this year. You might think that this is a small amount and would not make a difference. But what if all of our donors gave “just” $300? Such support would have a huge impact on those we serve.
For those who do itemize their deductions, the new law allows for cash contributions to qualified charities such as RMHC of the Bluegrass to be deducted up to 100% of your adjusted gross income for the 2020 calendar year.
We are grateful for your continued kindness and support during this unimaginably difficult time. Please contact Chelsi McDonald at Ronald McDonald House Charities of the Bluegrass to discuss how your gift can help further our mission of keeping families close when they need each other the most!