Donation Tax Question (U.S.)

The Price you sell it for. It is called in-kind donation. You are entitled to donate it at the retail price! The charity or non-profit (must have a 501 c 3 certificate) must provide you a receipt in the full retail amount of your in-kind donation.

I am a minister and I do this all the time for donors - anyone want to donate to my org for tax breaks - just PM me! : ) Thanks!

Well, if you donate $500, and get a gift valued at $300, you can only count $200!!!!!!!! So I'm sure you can only declare what it costs. If you buy a computer at $500, and often sell it for $100,000, could you declare the $100,000? And my example might seem phony, but I have seen computers that probably cost no more than $3000 valued at well OVER a MILLION dollars US after adding software, and sometimes it is by the SAME company!

HECK, look at what SUN did several years ago! I worked for one company that had TONS of SUN computers! ALL of their high end ADMINS had huge SUN workstations. *****ALL***** were DONATED by SUN!

Anyway, I would say DEFINITELY speak with an accountant. I am simply trying to apply some logic based on the OTHER side being as it is. I could be wrong. A minister, EVEN if he read he tax code and discussed this with EVERY donor could certainly be wrong. HECK, the IRS has declared that IRS agents have NO say in ANYTHING! They are allowed to lie to you and you are still responsible regardless. But ask an accountant.

Steve

Actually...

"Churches that meet the requirements of IRC section
501(c)(3) are automatically considered tax exempt and
are not required to apply for and obtain recognition of

tax-exempt status from the IRS."

Also, it is up to you to value the amount of your donation. NOT the church (or charity). This would put them in the position of being appraisers. Which they are not. They give you a letter saying you made the donation and it's up to you to place the value. Then, if you're audited it's between you and IRS whether the value you placed was correct.
(From my years as a Financial Secretary for a church.)

To answer your question: Ask a tax accountant.

Rose

Only your accountant reviewing your actual situation can give you an answer.

I assume you're itemizing. Additional issues besides cost and fair market value that can come into play include whether the donation is related to the purpose of the charity and how long you have had the item.

Here is a snippet pulled from my awesome tax deduction site discussing deductions of tangible personal property:

Example 1: if A buys a shirt for $10 their "basis" is $10.

If A sells the shirt for $15 on the market they have a profit of $5 which they are taxed on.

If A instead donates the shirt to charity their deduction starts at $15.

If A owns the shirt for less than a year then the $5 in income they would have received if they sold the property is deducted, leaving them with a $10 charitable deduction.

If A owns the property for more than a year then they can deduct the $15, unless the item is donated to a charity unrelated to the charity's purpose.

.

From IRS Publication 526:

Inventory

If you contribute inventory (property that you sell in the course of your business), the amount you can claim as a contribution deduction is the smaller of its fair market value on the day you contributed it or its basis. The basis of donated inventory is any cost incurred for the inventory in an earlier year that you would otherwise include in your opening inventory for the year of the contribution. You must remove the amount of your contribution deduction from your opening inventory. It is not part of the cost of goods sold.

If the cost of donated inventory is not included in your opening inventory, the inventory's basis is zero and you cannot claim a charitable contribution deduction. Treat the inventory's cost as you would ordinarily treat it under your method of accounting. For example, include the purchase price of inventory bought and donated in the same year in the cost of goods sold for that year.

A special rule applies to certain donations of food inventory.

Bottom line: talk to your accountant.