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We live in a continuing care facility (Penick Village), and we are told not to tip the "associates." Instead we are urged to donate to an employee Christmas fund which is distributed to employees on a longevity basis. This fund is run by the residents and not the organization.

I have assumed this is just a different way of tipping the employees so it has nothing more to do with taxes than if we were at a restaurant, but we received a communication that said that we should contact our tax professional to see if these donations are tax deductible. The fund has no 501c3 implications that I know of. (The organization does have a foundation that is a 501c3 organization, however, and donations to that are tax deductible. Money from that is used to give various levels of support to people who have run low on funds. No one is kicked out because of lack of funds.)

But is a donation to the employee Christmas fund tax deductible? I won't be surprised if the answer is no.

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