Proposed regs for charitable donations to complicate payroll
October 8, 2008 by Carol KatarskyPosted in: Communication, Hiring & training staff, In this week's e-newsletter, Internal controls, IRS regs, Latest news & views, Tax compliance
Does your company allow employees to make charitable contributions via payroll deduction? IRS wants to make those rules a lot harder to follow.
New proposed regs would require substantiation of all monetary charitable contributions — not just those over $250, which is the current rule.
What that boils down to is this: You’ll have employees coming to you asking for documentation so they can substantiate the donations you’re deducting from each paycheck. To provide substantiation, employees who are making contributions will have to get the following:
- Form W-2, pay stub or similar document from your company showing the amount withheld, plus
- a pledge card or similar item that shows the name of the organization being donated to. This pledge card would have to be prepared by, or at the direction of, the charity in question.
Effective date
The proposed regs would apply to any contributions made after the date the final regs are published in the Federal Register. Until the final regs take effect, you can rely on IRS Notice 2006-110.
You can download the entire proposed rule here.
Tags: Charitable contributions, IRS, Payroll, Proposed rules
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October 9th, 2008 at 11:51 am
In order to qualify to be 501 c3 type NPO orgainzation , what is most criteria to be careful managment structure and status in the pledge card or actual organization . ?
jhoshi@hitachitransport.com ( Day time. )
October 10th, 2008 at 2:37 pm
I see another box or code letter coming for W-2 forms.
October 13th, 2008 at 1:41 pm
[...] reading Proposed regs for charitable donations to complicate payroll, reader Joe W. theorized about the possibility of IRS adding another box to W-2 [...]