Haiti donation could lower 2009 tax bills

By Alexandra Twin, senior writer


NEW YORK (CNNMoney.com) -- Taxpayers may be able to deduct cash donations to Haiti earthquake relief on their 2009 tax returns if Congress passes a measure expected to be taken up this week.

Leaders of the House Ways and Means Committee from both parties said Friday they will introduce a bill that makes contributions made between Jan. 12 and Feb. 28 count toward an individual's or family's 2009 taxes.

The average taxpayer got a refund of $2,753 last year. How do you think your 2009 tax bill will compare?
  • I'll get a refund of at least $2,700
  • I'll get a refund, but less than $2,700
  • I'll owe less than $2,700
  • I'll owe more than $2,700
CDs & Money Market
MMA 0.38%
$10K MMA 0.35%
6 month CD 0.35%
1 yr CD 0.68%
5 yr CD 1.39%

Find personalized rates:
 

Rates provided by Bankrate.com.

Committee chairman Charles B. Rangel, D-N.Y., and ranking minority member Dave Camp, R-Mich., are expected to introduce the bill Tuesday when Congress reconvenes.

"This measure provides an immediate benefit for those who have already given and incentive for those who are considering a charitable contribution," Rangel said in a prepared statement.

Similar legislation was passed in 2005 to boost contributions in the aftermath of the Indian Ocean tsunami that occurred in late 2004.

Typically, charitable contributions count toward the year in which they are made. The current measure would mean taxpayers don't have to wait until next year to claim the benefit on their 2010 tax returns.

Factoring in the deduction: The Haiti relief contribution would count as an itemized charitable deduction. Itemized deductions are typically taken when an individual exceeds the standard deduction.

For 2009, the standard deduction for those 65 and under is $11,400 if married filing jointly or a qualifying widow, $8,350 if filing as a head of household, $5,700 if single and $5,700 if married filing separately.

If your adjusted gross income for 2009 tops $166,800 or $83,400 if married and filing separately, your charitable contribution is subject to the reduction of itemized contributions, usually 1%.

For cash contributions, the deducted ceiling is typically 50% of adjusted gross income, although in 2005, Congress passed legislation allowing 100% of income. To top of page

 
Frontline troops push for solar energy
The U.S. Marines are testing renewable energy technologies like solar to reduce costs and casualties associated with fossil fuels. Play
25 Best Places to find rich singles
Looking for Mr. or Ms. Moneybags? Hunt down the perfect mate in these wealthy cities, which are brimming with unattached professionals. More
Fun festivals: Twins to mustard to pirates!
You'll see double in Twinsburg, Ohio, and Ketchup lovers should beware in Middleton, WI. Here's some of the best and strangest town festivals. Play
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.19%4.24%
15 yr fixed3.27%3.18%
5/1 ARM3.38%3.32%
30 yr refi4.18%4.20%
15 yr refi3.26%3.16%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 16,987.51 -61.49 -0.36%
Nasdaq 4,567.60 -24.21 -0.53%
S&P 500 1,985.54 -11.91 -0.60%
Treasuries 2.61 0.08 3.28%
Data as of 12:45am ET
Company Price Change % Change
Bank of America Corp... 16.79 0.22 1.33%
Yahoo! Inc 42.88 1.62 3.93%
Apple Inc 101.66 0.23 0.23%
eBay Inc 52.19 1.51 2.98%
Microsoft Corp 46.70 -0.30 -0.65%
Data as of Sep 12

Sections

Uber isn't going head-to-head with FexEx, but it is claiming a piece of the delivery market. More

It's game time for the Fed this week, and investors are trying to read its playbook on interest rate hikes. More

Atlanta has the country's highest level of income inequality, but civic entrepreneurs can close the gap. Here's how. More

An extended time off from work can give you renewed energy for the job you have or give you time to figure out what you really want to do. Here are 8 lessons learned. More

Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.