Exempt Organizations Advisory - Tax Extenders Bill Includes Provisions for Exempt Organizations

By: Catherine W. Wilkinson (cwilkinson@steptoe.com)
Suzanne Ross McDowell (smcdowell@steptoe.com)

Today the House of Representatives passed the “Tax Extenders Act of 2009,” H.R. 4213. It is uncertain whether the Senate will take up the bill this year. The bill extends for one year 49 tax incentives that are scheduled to expire at the end of this year. Eight of these provisions apply to charitable contributions or exempt organizations. The bill extends:

• the increased contribution limits and carryforward period for contributions of real property for conservation purposes
• the higher charitable deduction for contributions of food inventory
• the higher charitable deduction for contributions of book inventories to public schools
• the higher charitable deduction for corporate contributions of computer equipment for educational purposes
• the allowance of tax-free charitable contributions from an Individual Retirement Account
• the special rules for unrelated business income tax for interest, rents, royalties, and annuities received from a controlled entity
• the exclusion from unrelated business taxable income gain or loss from the sale, exchange, or other disposition of a qualified brownfield property
• the special provision allowing S corporation shareholders to account for their pro rata share of charitable deductions even if the deductions exceed the shareholder’s adjusted basis in the S corporation