Friday, January 22, 2010


I realize that I have been “scooped” by my tax blogger brethren (and sistern) on this topic.

As the Washington Post has reported -

Taxpayers will be able to write off charitable donations to Haiti earthquake relief efforts when they file their 2009 taxes this spring, under a bill that received final congressional approval Thursday.

The Senate passed the bill on a voice vote Thursday, sending it to President Barack Obama for his expected signature.

The bill was passed by the House on a voice vote Wednesday, meaning no member of Congress opposed it

Taxpayers will have the option of deducting donations of cash or property to charities providing relief to the victims of the earthquake in Haiti made between January 12, the date of the earthquake, and February 28th on either their 2009 or 2010 income tax returns.
Obviously you should claim the deduction on the return that provides the greatest tax benefit – although it is too early in the year to really be able to make that decision. So if there is doubt I would suggest claiming the deduction on the 2009 return.

The bill (HR 4462) states that a phone bill with the date, name of charity, and amount of the donation will be acceptable as appropriate documentation of a deduction.

It is very important to remember that you get no tax benefit for making a charitable contribution to Haiti earthquake relief, or to any other qualified charitable organization, unless you can itemize on Schedule A. Nothing in the 2-page bill says that this deduction is allowed if you do not itemize.

And, of course, you must give the cash or property to a qualified charitable organization, like the Red Cross. You will get no deduction for sending a check to a specific individual or family in Haiti.

Two items of concern.

(1) If you do give be sure that it is to a reputable charitable organization – like, as I said, the Red Cross or the organization that is running tonight’s multi-channel telethon. As is usually the case in such a situation, there will be a lot of scams springing up.

(2) From a tax administration point of view – I am concerned that taxpayers who can itemize will, either on purpose or inadvertently, claim the same deduction on both 2009 and 2010 returns.

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