Exempt Organizations Assisting Katrina Relief

Donors to organizations that have their exempt §501(3) status recognized by the IRS receive income tax deductions for those contributions. For most organizations, this requires that the organization file a Form 1023, and then await IRS processing and eventual recognition of status.

While promising expedited review of applications of charities newly established to meet needs of those affected by Hurricane Katrina, the IRS suggested support be directed to existing exempt organizations that might be better able to deliver relief most efficiently. Form 1023 should be marked as specified to receive priority IRS attention for exempt status. (IR 2005-93)

Senate Estate Tax repeal Consideration Delayed

With promises to make estate tax repeal the first item considered when the Senate reconvened, it looked as though there might be some legislative attention to the issue today or this week. However, due to concerns about Hurricane Katrina, floor action on repeal has been indefinitely deferred.

Updated IRS Rates

September 2005 Applicable Federal Rates Summary (Rev.Rul. 2005-57):

-Short Term AFR - 3.9%
-Mid Term AFR - 4.19%
-Long Term AFR - 4.52%

October 2005 Quarter IRS Rates for Underpayments and Overpayments (Rev.Rul.2005-62):

- 7% for overpayments [6% in the case of a corporation]
- 7% for underpayments
- 9% for large corporate underpayments
- 4.5% for the portion of a corporate overpayment exceeding $10,000