Give to help Haiti now and deduct it on 2009 tax return
For the Nevada Appeal
Much has been in the news about the horrible disaster in Haiti. Who hasn’t seen the “Text to give $10 now” commercials over and over? Or commercials from the Red Cross, and various other non-profit charities.
Americans have been responding (as we always do) with great generosity.
Good news! Congress just did something right. (Amazing and stupendous!) There is a special relief provision in a new tax law just passed on Jan. 22 that allows you to deduct charitable contributions for contributions made between Jan. 12 and Feb. 28, 2010 … on your 2009 tax return!
From somebody who you might wonder if he has a charitable bones in his body, IRS Commissioner Doug Shulman was recently quoted as saying, “Americans have opened their hearts to help those affected by the Haiti earthquake. This new law provides an immediate tax benefit for the many taxpayers who have made generous donations.”
OK, you say, enough with promoting the IRS commissioner. How does the deduction work?
First, to get the 2009 tax benefit, you MUST itemize your deductions on Schedule A in 2009. If you claim the standard deduction, including all short-form filers, you are not eligible.
Second, you need to keep track of all cash-type donations that you make between Jan. 12 and Feb. 28, 2010. Property or goods do not qualify. Text message charges, checks, credit or debit card charges do. The donations must be identified specifically for the relief of victims in the areas affected by the Jan. 12 earthquake in Haiti.
Keep good records to document your donations, such as your cell phone bill for text messages, cancelled checks or a receipt from the charity. In all cases, your records must identify the name of the charity, the date and the amount.
Third, make sure your contributions only go to qualified charities. Check out IRS.gov under Search for Charities if you’re not sure. Some organizations, such as churches or governments, may be qualified even though they are not listed on IRS.gov. You can find out more about organizations helping Haitian earthquake victims from agencies such as ASAID. Remember, donations to foreign organizations are almost always not deductible.
Note that you may claim these deductions on either your 2009 or 2010 returns. If you opt to claim these 2010 special Haiti donations on your 2009 tax return, do not mistakenly attempt to deduct them again on your 2010 tax return.
For additional help, call your CPA to make sure you can take full advantage of this.
• Kelly Bullis is a Certified Public Accountant with more than 30 years of experience. Contact him at 882-4459.