TheWeekInCongress.com

Week Ending January 7, 2005

HR 241 to accelerate the income tax benefits for charitable cash contributions for the relief of victims of the Indian Ocean tsunami

BRIEF

   The bill would establish that a taxpayer may treat any cash contribution made in January 2005 for the relief of victims of the December 2004 Indian Ocean tsunami as having been made on December 31, 2004. The bill does not cover contributions other than cash contributions.

   The bill would allow for the contribution to be deducted from contributor's 2004 taxes rather than wait to file 2005 tax returns.

   Senator Max Baucus (D-MT) said that the bill wording, “…is framed as a cash deduction because that is what the relief agencies want. They want cash. First, cash can be transmitted much more quickly than in-kind contributions, as much as food and clothes is important. They can transmit the cash contribution with the speed of light, frankly. Second, with cash it can be disbursed and sent to the area where it is needed the most. Maybe food is needed, maybe medical supplies are needed in one area more than another, maybe clothing or tents or whatnot is needed. With the cash available, the relief agencies can decide what is the best use.”

Sponsor: Rep. William M. Thomas (R-CA-22^nd)

Vote: Passed House without objection (Jan. 6, 2004); Passed Senate by Unanimous Consent (Jan. 6, 2004); Presented to the President (Jan. 6, 2004); Signed by President Bush as Public Law 109-1 (Jan. 7, 2005). 

Cost to the taxpayers: No cost calculations were included with the bill. At the date of this writing (Jan. 7, 2004) it was stated by one Senator that Americans have donated $100 million to this tsunami relief this far. The cost of the bill, then, will be lost tax revenue due to claims made by individuals to deduct their contributions. ## All Rights Reserved. No reproduction or distribution without written permission from TheWeekInCongress.com.