Four U.S. Senators announced plans to introduce legislation to temporarily halt certain tax rules to encourage and increase charitable contributions for Haitian relief efforts.
Under current law, a taxpayer can only take a deduction for up to 50 percent of one’s income in a certain year, meaning a person cannot avoid paying any taxes by giving away all of their income in a given year, and a corporation can only donate 10 percent of its income.
After Hurricane Katrina, Congress waived both of these rules for donations designated for relief in the Gulf Coast. On Thursday, Jan. 14, two days after a series of earthquakes devastated the small island country, U.S. Senators George LeMieux (R-FL), Charles E. Schumer (D-NY), Bill Nelson (D-FL), and Kirsten Gillibrand (D-NY) proposed waiving the limitations for donations designated to Haiti relief in 2010.
In addition, given that the special tax rules for food donations expired at the end of 2009 and have not yet been extended, the senators’ legislation will extend the provision and allow corporations that donate food to the relief efforts to deduct the actual market value, rather than the cost to produce the food.
“This is a time of crisis in Haiti and Haitians need all the help they can get. This will encourage and empower people and organizations to contribute to the recovery and relief effort,” said LeMieux. “People want to help and removing any potential barriers will assist in that process.”
“Haiti needs our help now more than ever before and we need to make sure U.S. citizens have every opportunity to provide the Haitian people the humanitarian aid they need,” said Schumer, a member of the Senate Finance Committee. “Their resources need to be focused on saving the injured and finding shelter for the thousands who have been left homeless by this crisis, and the United States needs to do its part in assisting Haiti as much as we can. Encouraging American’s to provide as much help as they can is the least we can do while Haiti beings it’s recovery and rebuilding efforts.”
“The government shouldn’t be an obstacle for Americans who want to give extra to help those affected by the earthquake,” said Nelson, a member of the Senate Finance Committee.
“The tremendous damage in Haiti is horrifying and sobering for all of us as New Yorkers and Americans,” said Gillibrand, a member of the Senate Foreign Relations Committee. “The outpouring of support from individuals across the country has been inspiring, but there is more we can do. The legislation I’m proposing would make small, but important changes to tax law to encourage Americans to make further donations for emergency relief in Haiti. I pledge that I, along with my colleagues in Congress and the Obama Administration, will continue to do everything we can to bring relief to the people in Haiti.”
The senators are also warning Americans to beware of scams related to the Haitian earthquake. Disasters often prompt individuals with criminal intent to solicit contributions purportedly for a charitable organization or a good cause. Before making a donation of any kind, Americans should follow these guidelines:
- Do not respond to any unsolicited (SPAM) incoming emails, including clicking links contained within those messages.
- Be skeptical of individuals representing themselves as surviving victims or officials asking for donations via e-mail or social networking sites.
- Verify the legitimacy of nonprofit organizations by utilizing various Internet-based resources that may assist in confirming the group's existence and its nonprofit status rather than following a purported link to the site.
- Be cautious of e-mails that claim to show pictures of the disaster areas in attached files because the files may contain viruses. Only open attachments from known senders.
- Make contributions directly to known organizations rather than relying on others to make the donation on your behalf to ensure contributions are received and used for intended purposes.
- Do not give your personal or financial information to anyone who solicits contributions. Providing such information may compromise your identity and make you vulnerable to identity theft.
The Haitian earthquake has largely destroyed most of the buildings in Port-au-Prince, including Parliament and many of the city’s hospitals. Reports indicate that the streets are strewn with dead bodies and many more can be heard calling for help from underneath the rubble of fallen buildings.
Port-au-Prince is reported to be without electricity and humanitarian organizations previously working in Haiti have been paralyzed by the disaster. Five United Nations employees have been reported dead and more than 100 more are missing, as the office’s headquarters collapsed.
Aftershocks continue to rock the capital, making it difficult to begin recovery and reconstruction efforts. Destroyed roads are making it difficult to distribute humanitarian resources and though the Port-au-Prince airport remains open, the road connecting it to the capital is blocked.
Haiti, one of the most impoverished and politically unstable nations in the Western Hemisphere, was still recovering from four hurricanes that caused major damage at the end of 2008 when this earthquake struck. Due to the poorly constructed shacks that many Haitians live in, massive property damage and loss of life is expected. This is the worst earthquake to hit the Caribbean in more than 200 years.