Bill > S2595

This bill provides a tax deduction for charitable donations of food by farmers. The key provisions of the bill are: 1. Individuals engaged in the trade or business of farming in Massachusetts can claim a charitable contribution deduction for donating food from their farm to qualified charitable organizations, regardless of the limitations based on the taxpayer's prior year's tax rate. 2. Corporations engaged in the trade or business of farming in Massachusetts can claim a deduction for charitable contributions of food to qualified charitable organizations in Massachusetts, subject to the requirements, conditions, and limitations applicable to charitable deductions for contributions of food inventory under the Internal Revenue Code. 3. For the purpose of determining the deduction amount, the taxpayer (individual or corporation) can elect an alternate cost basis equal to 25% of the food's fair market value, regardless of whether they are required to account for inventories or capitalize indirect costs under the tax code. 4. The food donation must comply with the quality and labeling standards for "apparently wholesome food" under the Bill Emerson Good Samaritan Food Donation Act, and the recipient charitable organization must be located in Massachusetts, be exempt from federal taxes under Section 501(c)(3) of the Internal Revenue Code (excluding private foundations), and regularly receive and distribute contributed food. 5. The provisions of the bill are effective for tax years beginning on or after January 1, 2021.

Budget and Finance

https://malegislature.gov/Bills/192/S2595