The Good Samaritan Hunger Relief Tax Incentive Act
Fighting hunger is a team effort. Feeding America’s nationwide network provides food to 25 million people every year, and strong U.S. government programs are also vital to meet the nutritional needs of low-income Americans. The business sector—including farmers, food manufacturers, wholesalers, retailers, and others—also plays an instrumental role in battling hunger. By donating food and transportation and promoting volunteerism, businesses of all sizes help put food on the tables of families in need. While businesses already make substantial contributions to fight hunger, improved public policies—particularly passage of the Good Samaritan Hunger Relief Tax Incentives Act—will promote even greater business participation in this effort.
How Businesses Help
Food Donations
Feeding America distributes more than 2 billion pounds of food and grocery products every year to 63,000 local charitable agencies. Almost all of this wholesome food is donated by businesses around the country. More than 550 companies donate food through Feeding America’s national office, and many more give directly to their local Feeding America food bank.
Transportation Services
Securing food contributions is only one step in the process of alleviating hunger for millions of people. Just as importantly, food must be collected from donors and transported to food banks and other organizations. The process of transporting food is costly, requiring trailer space, refrigerated trucks, and fuel. In some instances, Feeding America has had to turn away offers of fresh food donations because immediate transportation was not available. Fortunately, some businesses help address this challenge by donating empty trailer space to transport food or by providing refrigerated trucks and vans.
Promoting Employee Volunteerism
Sorting and distributing 2 billion pounds of food and grocery products annually is labor-intensive. Many community groups, school groups, and businesses organize volunteer programs that help with this task. By encouraging employees to volunteer, corporations help the communities in which they operate and build a valuable positive image for their business. Volunteer efforts save food banks millions of dollars in labor costs and improve their ability to serve people in need.
Policy Recommendations to Encourage Business Response to Hunger
Expand Tax Deductions for Food Donations
Current tax law provides incentive for some businesses—C corporations—to donate food, but deductions could go further. Feeding America supports expansion of this special enhance tax deduction for food donations for all businesses and organizations, and for the deductions to be extended to include the fair market value of food donations. Many small businesses and restaurants, as well as farmers and ranchers, cannot avail themselves of the special deduction under current law. In addition, the tax code does not allow businesses to deduct the fair market value of their donations. In the past, temporary tax incentives have made it easier for all business taxpayers to donate food, but incentives need to be simplified and made permanent. We encourage Congress to pass the Good Samaritan Hunger Relief Tax Incentives Act to encourage all businesses to engage in charitable hunger-relief activities.
Create Tax Benefits for Donated Transportation Services
Because fuel costs have risen dramatically over the past year, the cost of transportation creates an even greater burden on hunger relief organizations. Tax incentives for donated transportation services would spur increased business participation in collecting and distributing donated foods. Such incentives will especially help bring food to charitable organizations in rural communities. Legislation has been considered that would allow a per-mile tax credit for hunger relief transportation, but this important proposal has not yet been enacted into tax law.