Vacation Donation – Hurricane Sandy

After large scale natural disasters, many companies allow employees to donate the value of unused vacation time, sick time, or general paid time off (PTO) to a charitable organization.

In the case of Hurricane Sandy, the IRS has announced that donations made to qualifying charities for hurricane relief prior to January 1st, 2014 will not be considered income to the employee.  Since the employee does not pick up the value of time donated in income, there is no charitable contribution deduction allowed on the employee’s tax return.

Also, in this case, the employer deducts the value of the donation as  a charitable contribution rather than as salary expense.