RITABLE
LES FOR CHA ONS IN 2020
NEW TAX RU CONTRIBUTI
DON’T FORGET THE CARES ACT’S SPECIAL BONUS!
Many people tackled deep-cleaning projects while spending more time at home last year. If your cleaning spree ended in donating items to a local charity, or if you donated funds to help local organizations supporting pandemic relief, you can look forward to some tax breaks! To feel confident in claiming them, here’s what you need to know about filing your 2020 taxes, including some unique additions from the Coronavirus Aid, Relief, and Economic Security (CARES) Act.
And the standard deduction for heads of household in 2019 was $18,350 and it’s $18,650 in 2020.
DEDUCTIBLE CONTRIBUTIONS If you choose to itemize your deductions, almost any gift to a qualified charitable organization can be deducted against your taxable income. It’s very important to keep records of all your contributions. According to the IRS, when donating items to a local charity like the Red Cross or Goodwill, the deductible value equals the fair market value of your items. If you made cash donations in 2020, there is a special rule to be aware of: Donations to public charities are now 100% deductible instead of 60%. However, this doesn’t apply to private foundations. AN ADDITIONAL CHARITABLE DEDUCTION If you choose to take the standard deduction rather than itemize deductions on your 2020 tax return, you may qualify for a new dedication courtesy of the CARES Act. If you donated to a qualified charity before Jan. 1, 2021, you can deduct up to $300 for single filers, or $600 per married couple. The CARES Act can save you hundreds of dollars on your 2020 tax return. Use this guide to navigate the upcoming tax season. Happy filing!
ITEMIZED VS. STANDARD DEDUCTIONS When filing your taxes, you’ll need to first decide whether you want to itemize your deductions or take the standard deduction set by the IRS. Even those who cannot claim other tax credits or breaks qualify for the standard deduction. However, if you do have qualifying deductions and they add up to more than the standard deduction, it’s smarter to itemize your deductions. Take note that the standard deduction was increased in 2020 because of the CARES Act. In 2019, the standard deduction for a single person was $12,200; in 2020, it’s $12,400. For those who are married and filing jointly, the standard deduction was $24,400 in 2019 and $24,800 in 2020.
ESOLUTIONS !
VESTMENT R
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DON’T GIVE U
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Big Idea No. 6: Find your motivation. For the most part, investors are self-motivated, but it never hurts to seek extra help. Seek out fellow investors here at Heartland who can hold you accountable, hand out feedback, and give you an atta-boy when you need it. Big Idea No. 7: It’s not too late to re-group! If you feel your resolve slipping, block out 30 minutes, bolt the door, turn off your phone, and regroup. Review your investment resolutions, choose those that mean the most, and apply the ideas above. Big Idea No. 8: Make better use of your time. Pressure, stress, and bad time management will ruin your resolve. To keep your resolutions on track, you need to stop procrastinating for good. Your finances depend on it — especially in this economy! –Darin Garman
8 BIG IDEAS T
Big Idea No. 3: Only go for resolutions where your resolve is real. Only you can decide what matters to you. Don’t bother with lip service or faux resolutions made to appease others. Being honest with yourself is a prerequisite for investment success. Big Idea No. 4: Remember, investment requires resources. Whether you’re dipping your toe in the water with a 36-unit apartment property or investing in a much larger building, you need to do your research and gather resources. If you don’t, you’re setting yourself up to fail. Big Idea No. 5: Aim to make daily progress. Do you remember the Bill Murray movie “What About Bob?” and how the psychologist in it recommends “baby steps”? That’s a good approach to investing. Create a timeline for your objective and break it down into a daily to-do list.
Do you already feel your New Year’s resolve slipping?
If so, it’s not too late to turn things around! With these eight big ideas, you can rescue your resolutions and achieve your investment goals. Big Idea No. 1: Give yourself the time you need. If you resolve to spend a half hour every day working on an investment project, something’s gotta give to make that happen! Try finding other activities you can trim down by 10 or 15 minutes and put that time toward investing. Big Idea No. 2: Let your investment priorities govern your schedule, not vice versa. When it comes to investing, you’re the boss, not a worker bee! Don’t let interruptions distract you from your work. Instead, wrest control away from others and emphasize your priorities — it’s your financial future at stake!
2 DARINGARMAN.COM
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