Don't Mess With Taxes

Once again, the world has mobilized to help victims of a natural disaster.

In the wake of this weekend's deadly earthquake in Yogyakarta, Indonesia (more than 5,000 dead, 2,000 injured and 200,000-plus left homeless; latest details in this Washington Post foreign bureau report), international aid is pouring into the country.

A good chunk of that relief money no doubt is coming from Americans.

Unfortunately, this is becoming an all too common occurrence. Since the 2004 tsunami (sparked by a quake also originating off Indonesia) and Katrina, Wilma, Rita and the other hurricanes of 2005, we're all too aware of the process: Disaster, shock, compassion, contributions.

At one point, after a seemingly endless string of catastrophes, nonprofits worried about donor fatigue. But concern for our fellow residents on this spinning rock seems to have won out. Most people still want to do what they can to help. And that usually means sending a check to a charitable group.

If you're able to contribute, make sure you give to legitimate groups that will get the aid to Indonesia as quickly and efficiently as possible.

The Red Cross came under fire following Katrina, but it still is one of the best and most organized international relief agencies. Find out about its Indonesian efforts here.

Other groups already on the ground in Indonesia are Save the Children and Direct Relief International.

Before you write that check, though, consider two things.

First, make sure the group is legitimate. Sadly, in times of tragedy, con artists crawl out of the woodwork to take advantage of those in need and those who want to help them.

Be leery of unfamiliar charities. Question cold calls from groups seeking money for disaster victims. Look a little closer at solicitors with names that sound like long-standing philanthropic groups.

You can find more details on how to not become a charity scam victim -- and your recourse if you do -- at the National Consumers League and the Federal Trade Commission.

Second, make sure that the group to which you give has the IRS's imprimatur.

In order for you to claim a deduction for your donation, the recipient must be an IRS-qualified charity; that is, it must meet federal tax-exemption guidelines.

Legitimate groups will provide evidence that they are IRS approved, usually via a statement in their annual report or on their Web page, such as here at the DRI site. The phrase you're looking for is "501(C)3 tax-exempt organization."

If you don't see such IRS validation, or you just want to double check, call the IRS at 1-800-829-1040 and ask about the group's tax status. Or you can search for the group in IRS Publication 78, which is accessible online. GuideStar also has a search engine to help you validate philanthropic groups.

Filing, and deducting, time: When it comes time to claim your donation as a deduction, you'll want to be sure you follow the IRS rules. The main one: You must itemize rather than claim the standard deduction.

That might change in a few weeks (or months). Congress is looking at tax revisions that could give nonitemizers some charitable donation tax benefits. But for now, the itemizing requirement applies.

This story is a good guide for taxpayers who contribute to philanthropic groups. It was written for the 2005 filing year (which still is in play for procrastinators who put off filing until October), so it has last year's standard deduction amounts.

For 2006 returns, the standard deduction is $10,300 for married couples filing a joint return, $5,150 for single filers and $7,550 for head of household taxpayers.

If your contributions and other itemized deductions this year come to more than your filing status' standard amount, then you'll want to file Schedule A next year and take tax advantage of your goodwill gift.

If your deductions aren't that much, so what? Your contribution still will help those who need it and that's worth more than any tax break.

Ring of Fire's tragic history: This latest seismic activity is common in Indonesia and the other nations along the Pacific portion of the Ring of Fire.

Most memorable to date was, of course, the Dec. 26, 2004, quake and subsequent devastating tsunami. Following that, one group of scientists issued a warning (reported here) about future tremors.

The simmering Mount Merapi volcano also is further evidence of the planet's inner turmoil in that region.

The Associated Press compiled this list of other deadly quakes in Indonesia.

One not making the AP tally occured almost exactly three years earlier. The May 26, 2003, tremblor in Indonesia was of almost identical strength as the May 27, 2006, quake, but thankfully it was much less deadly.