September 28, 2006

Guidance on Recordkeeping Requirements for Gifts to Charity Sought from IRS

Patrick Lester of the United Way has asked Treasury for immediate guidance on new recordkeeping requirements for monetary gifts to charity under the Pension Protection Act of 2006, noting that the way the new requirements are interpreted could cause problems for United Way workplace-giving campaigns.

September 19, 2006

Mr. Michael Desmond
Tax Legislative Counsel
U.S. Department of Treasury
1500 Pennsylvania Avenue, NW
Washington, DC 20220

Dear Mr. Desmond,
United Way of America is seeking immediate guidance from Treasury on new record keeping requirements for monetary gifts to charity under the Pension Protection Act of 2006. Depending upon how these new requirements are interpreted, they may prove problematic for United Way workplace giving campaigns across the nation, which are already under way.

Section 1217 of the new law requires taxpayers claiming a charitable deduction to maintain records of all monetary contributions as follows:

"(17) RECORDKEEPING. -- No deduction shall be allowed under subsection (a) for any contribution of a cash, check, or other monetary gift unless the donor maintains as a record of such contribution a bank record or a written communication from the donee showing the name of the donee organization, the date of the contribution, and the amount of the contribution."

Under current Treasury Department regulations (Section 1.170A-13(f)(11)), for contributions of $250 or more, taxpayers must provide substantiation through pay stubs, W-2 forms, or other written documents, combined with a pledge card prepared by the recipient charity.

We are seeking clarification of Section 1217 -- specifically to determine if existing regulatory requirements will be continued, but applied to all gifts made through workplace campaigns, or if new procedures must be adopted to comply with the new law.

Thank you for your prompt attention to this matter. Please call if I can provide further information or assistance.

Patrick Lester