house passed tax extenders bill

On December 9, 2009, the House of Representatives passed the Tax Extenders Act of 2009. The $31 billion bill will extend over 40 tax provisions from 2009 to the end of 2010. Major tax provisions include extension of the research and development credit, the teachers’ supplies deduction and seven charitable provisions.

There are seven charitable provisions in the extenders bill. These are as follows:

  1. IRA Charitable Rollover — Distributions will be permitted up to $100,000 per year for IRA owners directly from the IRA to charity.
  2. Food Inventory Gifts — Businesses may give food inventory to charity and receive an enhanced deduction for gifts of apparently wholesome food.
  3. Computer Equipment — Corporations may receive an enhanced deduction for gifts of computers to educational organizations.
  4. Book Inventory — Corporations may receive enhanced deductions for gifts of books to elementary and secondary schools.
  5. Subchapter S Corporations — A Subchapter S corporation may gift appreciated property and the shareholder benefits from the full deduction.
  6. Conservation Property — Gifts of conservation property qualify for expanded deductions and longer carry-forwards.
  7. Rent Payments to Parent Charities — Fair value rent payments by subsidiaries will not be unrelated taxable income to the parent charity.

Editors Note: This list of tax extenders is nearly certain to be passed by both House and Senate. However, because the Senate has in the past objected to these revenue-raising provisions, it may be 2010 before the final extenders bill is passed.

For more information please visit Valencia Planned Giving website.


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