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On January 22, 2010, President Obama signed H.R. 4462, which will permit taxpayers who make cash contributions to the Haiti earthquake relief effort after January 11, 2010 and before March 1, 2010 to take their tax deduction in 2009. Although not completely clear, it appears that a taxpayer may instead claim the deduction for the 2010 tax year, if that affords him a better result.
The 2009 deduction is available only for cash gifts and only for gifts “made for the relief of victims in areas affected by the earthquake in Haiti on January 12, 2010.” A telephone bill will provide sufficient substantiation for gifts made by phone, such as by use of a text message. For other gifts, you should try to get the charity to note on your receipt that the donation was for Haitian earthquake relief. You must have a written receipt for any gift of $250 or more.
Your particular state may or may not conform to this provision. As of this writing, California and New York have not yet conformed to this legislation. We understand that New York most likely will conform but in recent times California frequently has not conformed to federal provisions that would reduce tax revenue.
This report is a publication of Loeb & Loeb LLP and is intended to provide information on recent legal developments. This report does not create or continue an attorney client relationship nor should it be construed as legal advice or an opinion on specific situations. For further information, feel free to contact us or other members of the firm. We welcome your comments and suggestions regarding this publication.
Circular 230 Disclosure: To assure compliance with Treasury Department rules governing tax practice, we inform you that any advice (including in any attachment) (1) was not written and is not intended to be used, and cannot be used, for the purpose of avoiding any federal tax penalty that may be imposed on the taxpayer, and (2) may not be used in connection with promoting, marketing or recommending to another person any transaction or matter addressed herein.