A bill passed by Congress and signed into law on January 22, 2010 allows taxpayers to deduct qualified Haiti earthquake relief contributions on their 2009 tax returns. Taxpayers have the option to deduct qualified donations made to charities engaged in earthquake relief in Haiti on their 2009 tax return (filed in 2010) or their 2010 tax return (filed in 2011). To be deducted on the 2009 tax return, the contribution must have been made after January 11, 2010 and before March 1, 2010 and must be a cash contribution (cash, check, credit card, money order, debit card or text message). Non-cash (property such as food or clothing) donations do not qualify for this accelerated deduction.

Taxpayers claiming the deduction should maintain a record of the contribution such as bank statement, cancelled check, credit card statement, letter from the donee organization or if made by text message, a telephone bill. The record should substantiate the date, amount and the name of the charitable organization.

The State of North Carolina’s Department of Revenue has issued a bulletin that it will follow the federal provisions and allow the accelerated deduction. Thus North Carolina residents may take advantage of this provision without making any change to their 2009 North Carolina tax return.

Please contact us if there are questions regarding this charitable donation deduction.