Make Sure Your Charitable Contributions Are Deductible
The IRS has increased the record keeping requirements for cash charitable deductions under $250. Under prior law, cash donations of under $250 could be documented by a simple record maintained by the taxpayer. For example, if you donated $10 per week ($520 per year) at church, you could document the donations by simply keeping a record log. Under current law, for donations under $250, you must now maintain a bank record (such as a canceled check) or a detailed written receipt from the charity. Under current law, if you donated the same $10 per week in cash you could NOT claim a deduction unless the church gave you a written acknowledgment of how much you contributed during the year. If you donated a $10 check every week, you could claim the deduction based on your canceled checks.
The rules for cash gifts of $250 or more have not changed. These donations require a written acknowledgment from the charity. Bank records will not suffice for cash donations over $250.
Big Business May Take Big Tax Hit
The IRS has proposed to FedEx the reclassification of its delivery drivers as employees, rather than as independent contractors. If the IRS succeeds in the reclassification, FedEx will owe tax and penalty of $319 million plus interest for misclassifying the drivers.