Bill Would Extend Tax Breaks for Gifts of Food

Congress is considering legislation that would make permanent a tax deduction for businesses that donate their surplus food to charity.

The deduction, which expires at the end of the year, allows businesses to write off the cost of donated food, plus one-half the profit they would have made had the product been sold. The temporary deduction was part of the Pension Protection Act of 2006.

Rep. Sander Levin, a Michigan Democrat and the sponsor of the bill, said the deduction should be made permanent because food pantries and soup kitchens are having difficulty getting enough food to feed the more than 25 million people who seek emergency meals annually.

Mr. Levin cites a report from America’s Second Harvest, which has seen a 2-percent rise in the amount of food donated in the 2007 fiscal year — an increase he said was fueled by the tax deduction.

America’s Second Harvest also reported a 28-percent increase in donations of fresh fruits and vegetables. That increase was largely the result of donations from farms and ranches that took advantage of the deduction, Mr. Levin said.

“This tax-incentive program is working to encourage the donation of healthy foods to people in need,” Mr. Levin said. “We must act to make it a permanent part of the tax code so it becomes a permanent part of the food-donation plans for these eligible businesses.”