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On January
22, President Obama signed into law H.R. 4462, a bill that allows
donors to accelerate the income tax benefits of charitable cash
contributions for the relief of victims of the earthquake in Haiti.
The bill allows individuals who make charitable contributions to
aid Haitian earthquake victims to elect to claim an itemized charitable
deduction on their 2009 tax return (instead of having to wait until
next year to claim the deductions on their 2010 tax return). The
election applies only to Haitian relief contributions made in cash
after January 11, 2010, and before March 1, 2010. If the election
is made, Haiti relief donations are deductible on the 2009 return,
not the 2010 return.
The bill also relieves recordkeeping requirements for Haitian relief
contributions. For these contributions, a telephone bill satisfies
the recordkeeping requirements if it shows the name of the donee
organization, the date of the contribution, and the amount of the
contribution.
Anyone who is contemplating making a contribution to help victims
of the earthquake in Haiti should consider doing so before March
1, 2010. If the taxpayer is an individual who itemizes, he will
then be in a position to deduct the contribution in either 2009
or 2010, whichever produces the greater tax savings.
Please contact our office if you have any questions or if we can
assist you in deciding whether to claim your deduction in 2009 or
2010.
To comply
with the requirements of IRS Circular 230, we must inform you that
the information discussed above is not intended or written to be
used, and cannot be used by the recipient or any other taxpayer,
for the purpose of avoiding penalties that may be imposed under
the Internal Revenue Code or any other applicable tax law, or to
promote, market or recommend to another party any transaction, entity,
investment plan, arrangement or other matter.
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