Almost two weeks now has passed since the Jan. 12 earthquake that devastated much of Haiti, including the island nation’s capital of Port au Prince. With rebuilding costs estimated in the billions, individuals and companies have been heartfelt and inspiring in their response to send money, food and medical supplies.
Just in the last few days, I’ve gotten news from the Risk and Insurance Management Society and Unum, which have donated a generous $10,000 and $200,000 respectively. Every time I hear about people and companies giving so freely to help others in need, my heart soars.
However, as I know you’ve heard, the relief effort has not been easy. Although there’s nothing you or I can do about the logistical chaos in getting aid where it most needs to be, I did want to raise a couple benefits-related matters that you can pass along to your colleagues, company execs or employees to help them make the most of individual or corporate efforts to help Haiti.
First, RIMS offered a link to a recent New York Times piece, helpfully providing tips for individuals and corporations on avoiding scams related to relief donations. Here’s the link; I encourage you to pass it along to your colleagues so that their generosity gets funneled in the right direction.
Second, I received an e-mail from the New York State Bar, which sent a letter last week to various federal agencies, specifically asking the Treasury Department and Internal Revenue Service to issue guidance providing the types of tax relief for workplace Haiti assistance programs that have been made available in connection with certain other recent catastrophic events, both in the United States and abroad.
For example, in the wake of past domestic disasters like Hurricane Katrina, some employers allowed employees to donate paid leave to affected colleagues or to forgo leave so their employer could make a cash contribution to a qualifying charitable organization. The IRS provided limited relief to enable these programs to be offered on a tax-favored basis. The IRS has also declared that certain expenses related to non-U.S. disasters, such as the 2008 earthquake in China, were entitled to tax-favored treatment.
However, as of today, the IRS has not provided Haiti-specific tax breaks for workplace relief efforts. NYSB’s letter specifically addresses leave-sharing programs and reads in part:
“In particular, some employers may wish to institute leave-sharing programs in order to permit employees to donate some of their leave-time to other employees with family members in Haiti or leave-donation programs in order to permit employees to donate the value of their accrued leave time to charitable organizations providing assistance in Haiti. Programs of this kind raise issues relating to whether any party to such transactions has taxable income, and the nature and availability of any deductions. The IRS has addressed these issues in several previously issued Notices.”
How have you and/or your company helped the relief effort in Haiti? Do you have plans to implement a workplace donation program?
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