In Our View: Wait on Tax Break
: "In Our View: Wait on Tax Break
Thursday, January 13, 2005
Columbian editorial writers
Benevolence is wonderful, but it can go astray.
Take, for example, Congress' speedy passage of legislation that it hopes will result in more individual contributions to tsunami victims. The new law, signed by President George W. Bush on Jan. 7, allows taxpayers to claim charitable contributions for tsunami-related cash donations made in January 2005 on their 2004 tax returns. On Monday, the Internal Revenue Service issued guidelines explaining how to take advantage of the early return (visit www.irs.gov).
Normally, charitable donations made in a given year can only be claimed on that same calendar year's tax form. It keeps things nice and tidy. But good intentions have lead our lawmakers to this ex post facto tax break of sorts. We fear it will also lead to confusion and possibly tax cheating.
If you've ever claimed charitable contributions before, you know that the tax form provides a fairly loose process for doing so that relies on the honor system and a fear of a possible audit. You don't mail in receipts or even list where donations went. Instead, you keep your records of various transactions in case of an audit. But will people in 2006 remember that they already claimed some or all of their January 2005 charitable donations for tsunami relief efforts? It's quite possible they won't, and that they'll accidentally take the tax break twice, which is not allowed. Even if they do remember, it might be tempting for people to use the donation on both years' tax forms, knowing that if they are audited, they'll have a convenient alibi that they simply forgot their good deeds had already been accounted for.
IRS media spokesman Bill Steiner told us Wednesday that there is no go"