Tuesday, January 26, 2010

Certain Donations for Relief in Haiti to be Deductible for 2009

The Haiti Assistance Income Tax Incentive Act was enacted on Friday, January 22, 2010. It allows US taxpayers who give to charities providing earthquake relief in Haiti to claim these donations on their 2009 tax returns. Qualified contributions must be made after January 11, 2010 and before March 1, 2010. Taxpayers have the option of deducting these contributions on either their 2009 or 2010 returns, but not both.

Only cash contributions are eligible, as opposed to contributions of property. Taxpayers must keep proof of payment as typically required for charitable contributions, however, an exception was made for amounts donated via text message in that the cellular bill showing the name of the charitable organization, date, and amount will satisfy the requirements.

Taxpayers must itemize deductions in order to benefit. Qualifying contributions must be made to a US-based organization that is assisting with relief efforts. IRS Publication 78, Cumulative List of Organizations, can be used to help identify qualified organizations.

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