Posted on: Thursday, March 28, 2002
IRS loosens rules for contributions
| • | Generosity surpasses expectations |
Associated Press
WASHINGTON — Tax season is getting easier for people and charities involved in the outpouring of generosity that followed the Sept. 11 attacks.
The Internal Revenue Service announced yesterday it won't require as much immediate documentation as usual for people who made donations last fall, making it simpler for taxpayers to claim deductions and lifting a paperwork burden for hundreds of nonprofit organizations.
More than $2 billion has been contributed specifically in response to the attacks on New York and Washington, according to the Chronicle of Philanthropy. Much was donated to established groups such as the American Red Cross, but the IRS also lists 262 tax-exempt organizations that were created in the weeks after the attacks.
These less-experienced groups, tax experts say, could be having trouble getting out the paperwork a taxpayer needs to justify claiming a charitable deduction.
The law requires taxpayers making contributions of $250 or more to have "contemporaneous" written documentation from a charity if their tax return is challenged. A canceled check by itself isn't good enough because cheaters could pad the amount with money used for some non-charitable purpose.
For contributions made after Sept. 11 and before the end of 2001, the rules have been relaxed for deductions that could be claimed on tax returns due April 15 in most of the country. Taxpayers who made such donations have until Oct. 15 to either obtain the normal written acknowledgment or show a good-faith effort to get one.
