Deducting Haitian Relief Contributions on your 2009 Tax Return

To encourage donations to charitable organizations working in Haiti, Congress recently passed and President Obama signed into law, a special measure making your cash contributions tax deductible in 2009 even though they are made in early 2010. The new law gives you flexibility in deciding when to claim a deduction for your early contributions.

Typically, if you file an itemized individual federal return and you want to deduct your charitable contributions, you can only deduct the contributions you made in that tax year. The earthquake hit Haiti on January 12, 2010. Under the normal rules, charitable contributions made to help Haiti would be deductible when taxpayers file their 2010 returns in 2011. The new law makes a special and temporary exception for Haiti relief.

Under the new law, you can treat a contribution made to help Haiti after January 11, 2010 and before March 1, 2010 as if made on December 31, 2009. You can decide whether to deduct your 2010 Haiti contribution on your 2009 return or your 2010 return. However, you cannot deduct the same Haiti contribution on both your 2009 and 2010 returns. You can, however, allocate multiple donations to more than one year. Of course, to take a charitalbe deduction of any kind, you must opt to itemize your deductions rahter than take the standard deduction.

Note that in order to qualify for the accelerated deduction,the contributions must be cash and must be made to a qualifying charitable organization. Some charities use names that sound or look like those of respected, legitimate organizaions yet may be phony.

With questions, please seek advise from your Certified Public Accountant.