September 19, 2017
The Internal Revenue Service (IRS) has announced special relief to support tax-favored leave-based donation programs to aid victims of Hurricanes Harvey and Irma. In the past, the IRS has offered similar programs after other national catastrophes like the Sept. 11, 2001 attacks, Hurricane Katrina in 2005 and the Ebola crisis in 2014.
Under the program, employees can effectively donate their vacation, sick or personal leave in exchange for cash payments to qualified charities offering relief to the victims of the disasters. The donated leave will not be included in participating employees’ taxable wages. Instead, employers may deduct these cash payments as business expenses. Donations must be made before Jan. 1, 2019.
For more information regarding tax implications related to the two hurricanes, please see the IRS website here and here.
For further information, please contact LaborCompliance@castandcrew.com.
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The proceeding information is provided for informational purposes only, should not be construed as or relied upon as legal advice and is subject to change without notice. If you have questions concerning particular situations, specific payroll administration or labor relations issues, please contact your counsel.