The new year is not just a busy time to map out your upcoming fundraising objectives, it’s also time to start planning for tax receipts for donors' gifts made the prior year. And while best practice is to refrain from asking for a gift with the statement, this is an opportunity to thank your major, mid-level, and sustaining donors for a year of support.
The 2020 CARES Act had two important provisions for tax deductibility for donor gifts in 2020. As of legislation signed on December 28, 2020 those provisions have been extended to 2021. First, charitable contributions up to $300 in 2020 are considered an “above the line” deduction on donors’ taxes. Second, donors may now claim a charitable deduction up to 100% of their Adjusted Gross Income for cash gifts to nonprofits. There are no significant changes that should impact the compliance component of the tax statements provided to donors. However, compliance isn’t the only concern. Tax statements are a way to engage with donors and be of service to them regardless of how they file their tax return.
The strength of public media is that our supporters use and place a high value on the service stations provide. So, with that lens, strengthening that connection by practicing good stewardship is paramount.