IRS NOTICE 2001-78

Disaster Relief Distributions By Charities To September 11 Terrorist Attack Victims

Part III - Administrative, Procedural, and Miscellaneous

Disaster Relief Distributions by Charities to Victims of September 11, 2001 Terrorist Attacks.

Notice 2001 - 78

Several charities have raised questions about the practical application of existing legal standards for distributing funds to victims of the September 11, 2001 terrorist attacks against the United States. The Internal Revenue Service recognizes the unique circumstances caused by this tragedy and wishes to alleviate concerns that might otherwise delay relief to victims.

Congress is considering clarifying legislation in this area. While Congress is considering legislation, the Service recognizes the need to provide interim guidance to charities regarding payments made by reason of the death, injury or wounding of an individual incurred as a result of the September 11, 2001 terrorist attacks against the United States.

Accordingly, the Service will treat such payments made by a charity to individuals and their families as related to the charity's exempt purpose provided that the payments are made in good faith using objective standards.

This administrative treatment will continue to apply to any payments made to such individuals before the earlier of final legislative action addressing these issues or December 31, 2002. The Service will consider what, if any, additional guidance is needed in this area.

Organizations that have questions concerning this notice may contact Marvin Friedlander at (202) 283-2300 (not a toll free number).

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