End of the year giving

Today is the one-year anniversary of the Tsunami in South Asia. There remains substantial need for relief and aid for the victims of that disaster.

Earlier this fall, you may have noticed that I posted links for making contributions for relief in the wake of Hurricane Katrina; I linked to the PCA's MNA (Mission to North America) relief page and to the Red Cross. Both organizations, by the way, are still in great need of continued support and funding as they serve the relief effort.

Congress took special action to make it easier to give to disaster relief this year: KETRA, the Katrina Emergency Tax Relief Act, was passed in September to make room for more donations. In brief, this law temporarily removes the restriction on itemized charitable donations, so that 100% of your charitable giving is tax deductible, up to 100% of your Adjusted Gross Income. In other words, you can give a lot more to qualified charities and get tax-deductions for it. (A good explanation, with more detail, can be found at this link.)

From what I can understand, the spirit of this law was two-fold in intent: first, Congress obviously wanted to make it easier on folks who felt compelled to give financially to the relief efforts. Good idea. But Congress was more forward-thinking than that-- they also recognized that many people would give to relief with funds that otherwise would have gone to other charities. Thus, churches and schools (and even museums and symphonies) would find themselves in a financial shortfall because of the natural disasters. Congress passed KETRA to make a way for givers to give even more than usual, so that no one who depended on the generosity of others would come up short.

This law expires on December 31, 2005, so it will only be effective for a few more days. It will, however, cover any donations that you make between now and the end of the calendar year.

Disaster relief has had an especially prominent place in our media and culture this year. It may be the case that, as you reach the end of the year, you have forgotten to actually make the donations you had planned to make. Or maybe you gave money to relief that otherwise would have gone to your church or another charity. Here's an opportunity to fill in those gaps, with a tax benefit attached. I want to encourage you to consider doing it.