• Stein Strategies LLC

Messaging the CARES Act to supporters.

There’s a lot of information out there about the CARES Act and my hopes is this won’t be redundant for you. I’ve been collecting ideas from thought leaders and nonprofits and incorporated a few of my own strategies as to how nonprofits can incorporate the relatively new legislation into their communications and marketing.

Above-The-Line Charitable Deduction Of $300:

The CARES Act allows donors to take an above-the-line charitable deduction up to $300 for cash donations made in 2020. This applies to anyone who doesn’t itemize and is added to the standard deduction. This does not include contributions to donor-advised funds.

· Add a $300 giving option on your giving page

· Create a mini-campaign around $300 donations

· Consider marketing the new above-the-line deduction along with employer matches, letting donors know they can double their impact with the employer match while taking the above-the-line deduction.

· Ensure anyone working with donors knows this information and can articulate it.

· Add this information on your general donation landing page.

Charitable Deduction Limits:

The CARES Act allows donors who itemize to deduct up to 100% of their AGI (up from 60% previously) for 2020 cash donations and any excess donations can still be carried forward for five years subject to the previous 60% AGI limit. Corporations may now deduct 25% taxable income (up from 10% previously). The deduction does not apply to contributions to donor-advised funds. The limit for gifts of appreciated long-term capital gains property remains at 30%.

· Ensure anyone working with major donors knows this information and can articulate it.

· Incorporate this information into your planned giving marketing.

· Add this information on your general donation landing page.

· Add this information on your planned giving landing page.

· Add this information to you “more ways to give” landing page.

· Remind donors that although the AGI threshold for giving appreciated assets has not changed, it remains an advantageous way to give as they avoid paying capital gains on donated assets and take a deduction based on the fair market value (as long as the stock has been held at least 1 year).

Required Minimum Distribution Changes:

RMDs are waived for 2020, but donors can still give up to $100,000 as a qualified charitable distribution (also known as an IRA rollover) directly from their qualified retirement plan to charity and it won’t be considered taxable income as long as they are at least 70.5 of age.

· Ensure anyone working with major donors knows this information and can articulate it.

· Incorporate this information into your planned giving marketing.

Want to wrap it all up for donors? If it works within your fundraising strategy to send a direct solicitation within the next few months, consider sending a letter acknowledging the times, asking for help to sustain the mission, recommend donors consult their tax professional, and giving a rundown on a these few key provisions of the CARES Act.

Stelter provided a templated letter with excellent language for nonprofits to use:

“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 a greater percentage of your retirement accounts. Many of our donors use their RMD to make a gift from their IRA. If you are 70½ or older, you can still make a gift from your IRA or name us as a beneficiary. In addition, there are some new ways you can receive financial benefits and help organizations like us.

The new law allows all taxpayers who do not itemize to take a charitable deduction of up to $300. 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 ours to be deducted up to 100% of your adjusted gross income for the 2020 calendar year.

We are so grateful for your generosity, which touches—and changes—so many lives. Please contact me at [insert email address] or [insert phone number] to discuss how your gift can help further our mission.”

I’d love to hear more ideas in the comments as to how organizations are marketing the CARES Act to their supporters!

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