Charatable Donations In Thailand

[cm-happy]

This year (2006) I have made several large donations to local wats. One was a Nissan Sunny saloon auto. The other a cash gift of 140,000 baht.

I plan on taking these as deductions when I prepare my 2006 income taxes.

does anyone have any experience with American IRS involving donations to foreign organizations. Problems or no problems??

[PeaceBlondie]

There are others on ThaiVisa forum who are qualified to answer, but I'm looking at the 2005 Publication 17 that says contributions to foreign organizations are not deductible, except certain Canadian, Israeli, and Mexican charities.

Even if it were deductible, you'd need to be itemizing on Schedule A instead of using the standard deduction, and you'd need a receipt from the organization, etc.

Without being paid for a formal opinion, I'd guess that donations to Thai wats are not deductible on Schedule A.

[lanny]

PeaceBlondie has it right!

The Internal Revenue Code limits charitable deductions to organizations listed by IRS. With few, if any, exceptions, these organizations are all US charities. This because they have to demonstrate to IRS their charitable purpose and other matters.

Secondly, the law was changed for 2006. In the past, you needed receipts for donations over $250; now the code requires receipts for EVERYTHING! And it is the code, not IRS regulations, so you won't be able to bargain with a Revenue Agent.

Of all my clients, only those who have homes back in the states or substantial medical bills have enough deductions to do better than the standard deduction. Unless you don't qualify for the foreign exclusion, or have substantial income in excess of the exclusion, it's hard to see how itemizing deductions is beneficial, anyway. Of course, every situation is unique and no one rule applies to all.

Also, you should be aware of another change to the law for this year. If you do take the foreign exclusion, and your income is greater than the exclusion, you will pay more tax for 2005. In the past, the income in excess of the exclusion was taxed at the lowest applicable rates. Beginning in 2006, this income will be taxed at the highest applicable rates. For many, this will come as a shock because the difference can be substantial.

[cm-happy]

Thanks all for the help

[Chang_paarp]

If you want to donate to a worthy cause in Thailand in the future, look at helping Mercy Mission in Pattaya.

A donation through a US based organisation will get you the tax deduction in the US, and the funds will go to Mercy Pattaya. Look here.