Taxpayers wishing to lend support the relief efforts in
Haiti now have an additional incentive to do so, thanks to new legislation
signed into law by President Obama.
The new bill gives taxpayers two options regarding monetary
contributions for Haitian Earthquake Relief. They can either deduct
contributions made after January 11, 2010 and before March 1, 2010 on their
2009 tax return or they can wait and claim the deduction on their 2010 return.
In addition to allowing contributions to be deducted on a 2009 tax return, the
bill also includes a provision that recognizes donations made to a charitable
organization via text message, provided that a copy of the phone bill showing
the date, time, organization name and donation amount is available.
There are several ways to make a tax-deductible contribution
to a qualified charitable organization: through a cash payment, check or credit
card charge or by making a payroll deduction to a charity.
Be sure to keep records of your donations. Acceptable
records include a receipt from the organization that states the date, name,
address, location, and amount of the donation; a cancelled check; or other bank
documents that provide the same information. Don’t forget to claim all the
household items and clothing you donated to your church, school, or other local
charity during the year. The fair-market value of all items in good or better
condition that are donated to a qualified organization are deductible. Make
sure you keep a list of all items donated and their value when you contributed
them. If you volunteer your time, you can also deduct out-of-pocket expenses
you have that are directly related to your volunteer work.
When choosing a charity to make a donation to, keep in mind
that contributions to domestic, tax-exempt organizations that provide
assistance to individuals in foreign lands qualify as tax deductible
contributions for federal income tax purposes, provided the U.S. organization
has full control and discretion over the uses of such funds. Contributions to
foreign organizations are generally not deductible. Contributions to benefit
specific individuals or families are also not deductible.
You can search for qualified organizations on the Internal
Revenue Service (IRS) Web site at www.irs.gov.