Can a charitable contribution made on December 31 by credit card to a call center be deemed tax deductible to the donor if processed on January 3, the next business day?
The IRS has ruled that a credit card gift is deemed to have been made on the date the charge is made against the account. The IRS views that the donor has an obligation to the credit card company on that date and the credit card company has an obligation to the ultimate charitable recipient. This is true even though the payment isn’t actually made by the donor until January.
Therefore, if you are making a credit card gift on New Year’s Eve, you want to be sure that the person who receives the gift makes the credit card transaction before midnight. In your case, it sounds as though you would be delayed a year in taking the donation if the transaction is not processed until January.
The rule is different for contributions by check. Checks put in the mail on before December 31 are deemed to be out of the control of the donor and are valid as contributions when mailed if the check clears in the normal course of events.