Matt Roberts, MFM, CFP®, CAP®, Chief Planning Officer
November 23, 2020
As we near the end of the year, financial planners across the country are helping to remind their clients about key December deadlines for contributions and other transactions.
The CARES Act, passed unanimously by the Senate on March 25, 2020, in response to the pandemic, created some opportunities for financial planning clients. Here are three key provisions along with December deadlines.
1) For those who don’t itemize in 2020, you are allowed to take an above-the-line deduction by December 31 for up to $300 for Qualified Charitable Contributions.
2) The limit for cash gifts to charity in 2020 was raised to 100% of Adjusted Gross Income (the limitation is normally 60%). Any amounts gifted over 60% cannot go to a Donor Advised Fund. All donations need to be made by December 31.
3) Required Minimum Distributions (RMDs) from retirement accounts were waived for 2020. This will expire at the end of 2020 unless Congress takes additional action.
For more information about the CARES Act, please reference my March article.
Here are December deadlines that may apply to your financial situation.
- Final date to submit requests to fund charitable gifts with securities
- Make sure all checks for Qualified Charitable Distributions (QCDs) from IRAs have been mailed (the charity needs to cash the check in order to qualify as a QCD for 2020).
- Final date to submit request for Roth conversions
- Final date to request distributions for investment accounts to ensure the funds go out by December 31.
- Checks to charity have to be postmarked by December 31 in order to qualify for a 2020 tax deduction.
- Final date to make employee contributions to 401(k)’s and 403(b)’s. Traditional IRA and Roth IRA contributions can be made for 2020 up until April 15th, 2021.
- According to the CARES Act, you are allowed to take an above-the-line deduction by December 31 for up to $300 in Qualified Charitable Contributions for those who don’t itemize in 2020.
- The CARES Act raised the limit for cash gifts to charity in 2020 from 60% to 100% of Adjusted Gross Income (AGI). Any amounts gifted over 60% cannot go to a Donor Advised Fund. All donations need to be made by December 31.
If you need a financial planner for advice on year-end deadlines or your financial planning, call Syverson Strege at 515-225-6000 to schedule a complimentary, no-obligation consultation.