WASHINGTON – Workers who want to help Hurricane Katrina relief efforts can turn their free time into cash by taking advantage of a program that converts unused vacation days into charitable donations.
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• COMPLETE COVERAGE
Video, slideshows:
• Visit WWL-TV's Web site for streaming newscasts from New Orleans.
• Video:Watch President Bush's Sept. 15 address
• In their own words: Survivors' stories
• Slideshow: Reader-submitted photos from wwltv.com
• MORE SLIDESHOWS
Give, get help:
• FEMA, 1-800-621-FEMA
• DisasterHelp.gov
• Red Cross, 1-800-HELP-NOW; 1-866-438-4636 to get help
• Red Cross Family Links Registry, 1-877-LOVED-1S (1-877-568-3317)
• Bush-Clinton Katrina Fund
• Salvation Army, 1-800-SAL-ARMY
• Catholic Charities
• SPCA of Texas
• Noah's Wish
• Louisiana SPCA
• FEMA charity tips
External links:
• WWL-TV: Text blog of latest Katrina updates
• Wikipedia: 2005 Atlantic hurricane season
• Craigslist New Orleans: Community bulletin board
The Internal Revenue Service offered the program after the Sept. 11, 2001, terrorist attacks and revived it in the wake of Hurricane Katrina to support organizations helping people recover from damage to the Gulf Coast.
Here, in question and answer form, is a closer look at the program.
Q: How does it work?
A: Your employer decides what kind of leave - such as vacation, sick or personal days - can be donated. It must be unused leave that you're entitled to receive. You decide how much to donate. Your employer converts the donated days into a cash donation and makes the donation to the charity on your behalf.
The donation does not affect your paycheck or the tax statement that your employer mails at the end of the year for preparing a tax return.
Q: Does my company participate?
A: Ask the office that handles payroll and vacation accounting for more information. The IRS does not keep track of companies that participate in the special donation program. It offers guidelines to businesses, but it's up to employers to structure the program and make it available to employees.
Q: Why participate?
A: The program lets workers make a cash contribution without paying any cash, but by giving up vacation or other unused work leave. People on tight budgets, and those who have already made cash donations but want to do more, only have to give up some free time.
Q: Who gets the donation?
A: It's up to the employer to decide where to donate the money. The IRS requires only that the recipient qualify as a charitable organization under IRS guidelines and that the money be used for Hurricane Katrina relief operations.
Q: What is my donation worth?
A: The donation is worth the wages you would be paid for the number of donated days. Your employer can tell you exact value of the donation.
Q: Do I get to take a tax deduction for the donation?
A: No. Although you are donating your time, your employer is donating the money. That means the employer gets to take the tax deduction. IRS officials say that won't matter to the many taxpayers who use the standard deduction. Taxpayers must itemize their deductions to take a deduction for a charitable donation.
Q: What if I've used up my vacation and sick days this year?
A: Because the federal government expects the regions devastated by Hurricane Katrina to need help for a long time, the IRS program runs through 2006. That means leave accumulated next year will also be also eligible for donation. Your employer must make its donations before the end of next year.
Q: Why is the IRS involved?
A: The IRS set up special rules to prevent employees from owing tax on the donated time. If you cashed out leftover vacation or sick days, you would get extra income and owe tax on that added money. By letting the company donate the time directly to the charity, you don't see any additional income and you avoid paying extra tax.
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On the Net:
Internal Revenue Service on Hurricane Katrina
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