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Here are the tax break for ones interested.
A higher mileage deduction for volunteers. Volunteers who use their cars to help Katrina-related charities will be allowed to deduct 70% of the IRS standard mileage rate, the rate claimed by taxpayers who use their personal vehicles for business. As of Sept. 1, the IRS raised the standard rate to 48.5 cents per mile, which would bring the rate to 34 cents. That's up from 14 cents a mile, a rate that hasn't changed since 1997.
The higher rate is limited to volunteer work for Katrina-related charities, Burlison says. The deduction for volunteer driving for other charities is still 14 cents a mile. In addition, the deduction is limited to volunteer work for a recognized charity, Burlison says. "If you're just doing something on your own that isn't sponsored by a charity, that's not going to be deductible."
Finally, the rate of 34 cents a mile is restricted to volunteer work performed between Sept. 1 and Dec. 31. If you used your car for Katrina-related charities from Aug. 29 to 31, your deduction will be 29 cents, or 70% of IRS standard rate before Sept. 1.
To stay on the right side of the IRS, "You really have to keep good records," Burlison says.
?Higher deductible cash contributions. Ordinarily, charitable deductions are limited to 50% of a taxpayer's adjusted gross income. Between Aug. 28 and Jan. 1, that limit will be raised to 100% of AGI.
The higher limit will benefit older taxpayers with tax-exempt income from municipal bonds and other sources, Burlison says. Similarly, it will help taxpayers who want to make a large one-time contribution from savings, says Mark Luscombe of tax publisher CCH.
The higher limit is for cash contributions, not donations of stock and other assets. The contributions don't have to be earmarked for hurricane relief.
