Notice 2022-28: Treatment of amounts paid to section 170(c) organizations under employer-based donation programs
Treatment of cash payments made by employers under leave-based donation programs to aid victims of Ukraine invasion
Treatment of cash payments made by employers under leave-based donation programs
The IRS today released an advance version of Notice 2022-28 that provides guidance on the federal income and employment tax treatment of cash payments made by employers under leave-based donation programs to aid victims of the further Russian invasion of Ukraine.
Notice 2022-28 [PDF 97 KB] provides that employer leave-based donation payments made by an employer before January 1, 2023, to section 170(c) organizations to aid victims of the further Russian invasion of Ukraine (qualified employer leave-based donation payments) will not be treated as gross income or wages (or compensation, as applicable) of the employees of the employer. Similarly, employees electing or with an opportunity to elect to forgo leave that funds the qualified employer leave-based donation payments will not be treated as having constructively received gross income or wages (or compensation, as applicable).
Electing employees are not eligible, however, to claim a charitable contribution deduction under section 170 for the value of the forgone leave that funds qualified employer leave-based donation payments. An employer may deduct qualified employer leave-based donation payments under the rules of section 170 or the rules of section 162 if the employer otherwise meets the respective requirements of either section of the Code.
For more information, contact a tax professional with KPMG’s Washington National Tax practice:
Ruth Madrigal | ruthmadrigal@kpmg.com
Preston Quesenberry | pquesenberry@kpmg.com
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