The Tax Blotter – September 2017
Undoubtedly, many of your clients will want to help out victims of Hurricanes Harvey and Irma, in the aftermath of those devastating storms. But there’s more to claiming a charitable deduction than just mailing in a check or posting a donation online.
Sep. 14, 2017
Undoubtedly, many of your clients will want to help out victims of Hurricanes Harvey and Irma, in the aftermath of those devastating storms. But there’s more to claiming a charitable deduction than just mailing in a check or posting a donation online. Consider the following:
Donate your day off. The IRS has announced special relief relating to leave-based donations programs to aid victims of Harvey and Irma (IR-2017-143, 9/5/17). Under these programs, employees may forgo vacation, sick or personal leave in exchange for cash payments made before to charities before 2019 by their employer. This relief resembles tax breaks previously authorized for other catastrophic events.
Scan for scams. Have you been contacted by someone soliciting support for hurricane victims? The IRS is warning taxpayers to watch out for scams designed to pull on your heartstrings (IR- 2017-137, 8/30/17). Fraudulent schemes may come via telephone, social media, e-mail or in-person. Criminals often send emails that steer recipients to bogus websites that appear to be affiliated with legitimate charitable causes. Be careful about disclosing personal information to any unrecognized charities.
Tap into your IRA. Don’t forget about a special tax law provision for certain retirees. If you’re age 70½ or older, you can contribute up to $100,000 directly from your IRA to a qualified hurricane relief fund without paying any tax on the distribution. In this case, you can’t deduct the contribution either, but you’re helping out a worthy cause. What’s more, the payout from your IRA counts toward the required minimum distribution (RMD) rules for this year.