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Senators Chuck Grassley, Republican (Iowa), and Max Baucus, Democrat (Montana), have made a proposal that 2004 charitable tax donations deadline - which ended on December 31 - be extended until January 31, 2005 for earthquake and tsunami disaster relief donations. Under current IRS tax rules, any donation made since the beginning of the New Year could not be deducted on 2004 taxes and would have to wait to be deducted from taxes filed for 2005. This extended tax break is currently a proposal, but the two senators are hoping to have Congress pass the legislation into law as early as possible.
Americans have reached deep into their pockets to help with earthquake and tsunami disaster in Asia. The American Red Cross alone reports receiving more than $92 million in pledges thus far. The <i>Chronicle of Philanthropy</i> has tallied more than $245 million in private donations and private donations are expected to top the $350 million in taxpayer money that the US has pledged. For a list of charitable organizations collecting for the earthquake and tsunami disaster, <A HREF="http://www.savingadvice.com/forums/showthread.php?t=3714">Click Here</A>
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<b>UPDATE</b>: Congress passed the bill allowing taxpayers to claim a deduction on 2004 income tax returns for cash donations made by January 31. The bill still needs to be signed into law, but President Bush is expected to sign in the coming days.
<b>UPDATE</b>: President Bush signed the bill into law on January 7 and it is now officially law. Donations made to qualifying charities before January 31 can be deducted off your 2004 taxes.
<b>Note On Qualifying Deductions</b>: If you are expecting that you can make this deduction, make sure you donate to a charity that qualifies for the deduction. For example, donations to the International Red Cross and most other foreign charities aren't tax deductible. A donation to the US Red Cross is tax deductible.
While the law extends the date for claiming donations to January 31, 2005, the law doesn't make an exception for donation to international charities. the Internal Revenue Service (IRS) isn't making any exceptions this year meaning that millions of dollars in donations made by US citizens to tsunami victims through overseas charities won't qualify for the charitable deduction.
Take care when making a donation because it can be confusing whether a donation will qualify or not. Foreign charities such as the Red Cross, Doctors Without Borders and Oxfam whose international branches don't qualify for a tax deduction also have affiliates located in the United States which can accept tax deductible donations. If you want the tax deduction, make sure that the charity receiving your money is based in the US.
Americans have reached deep into their pockets to help with earthquake and tsunami disaster in Asia. The American Red Cross alone reports receiving more than $92 million in pledges thus far. The <i>Chronicle of Philanthropy</i> has tallied more than $245 million in private donations and private donations are expected to top the $350 million in taxpayer money that the US has pledged. For a list of charitable organizations collecting for the earthquake and tsunami disaster, <A HREF="http://www.savingadvice.com/forums/showthread.php?t=3714">Click Here</A>
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<b>UPDATE</b>: Congress passed the bill allowing taxpayers to claim a deduction on 2004 income tax returns for cash donations made by January 31. The bill still needs to be signed into law, but President Bush is expected to sign in the coming days.
<b>UPDATE</b>: President Bush signed the bill into law on January 7 and it is now officially law. Donations made to qualifying charities before January 31 can be deducted off your 2004 taxes.
<b>Note On Qualifying Deductions</b>: If you are expecting that you can make this deduction, make sure you donate to a charity that qualifies for the deduction. For example, donations to the International Red Cross and most other foreign charities aren't tax deductible. A donation to the US Red Cross is tax deductible.
While the law extends the date for claiming donations to January 31, 2005, the law doesn't make an exception for donation to international charities. the Internal Revenue Service (IRS) isn't making any exceptions this year meaning that millions of dollars in donations made by US citizens to tsunami victims through overseas charities won't qualify for the charitable deduction.
Take care when making a donation because it can be confusing whether a donation will qualify or not. Foreign charities such as the Red Cross, Doctors Without Borders and Oxfam whose international branches don't qualify for a tax deduction also have affiliates located in the United States which can accept tax deductible donations. If you want the tax deduction, make sure that the charity receiving your money is based in the US.