Staying active in retirement is important for your physical and emotional health. One way that many retirees choose to remain active is through volunteer work within their communities. However, volunteering in person is not always possible due to health, travel, personal mobility or scheduling constraints.
Below are four smart ways you can still contribute to the causes and organizations you're most passionate about—while keeping your retirement strategy on track—even if you can't be there in person.
1. Know the revised rules for charitable deductions
In March 2020, the federal Coronavirus Relief, Aid, and Economic Security (CARES) Act was passed to provide financial support to individuals and businesses during the pandemic. Two of the provisions related to charitable giving were extended for 2021.
- You can deduct up to 100% of your 2021 adjusted gross income (AGI) for cash gifts to public charities (up from the usual 60%). If the value of your gifts exceeds 100% of your AGI, you will carry any excess gift amounts into next year.
- If you do not itemize deductions on your federal tax return, you can now take a charitable deduction of up to $300 for cash donations made to qualified organizations in 2021. This benefits those who typically do not itemize their deductions and therefore typically do not receive a tax benefit from their charitable contributions.
These provisions are scheduled to expire at the end of 2021. You'll also want to watch for any potential changes to the rules or dollar amounts for annual gifts in 2022.