AnotherGradStudent
Level 2 Member
Continued from the Free Paper thread, but with a more through focus on 'how legal would this be'? Disclaimer: I am not a lawyer, especially not a tax lawyer, and expect that none of ya'll are either (or at least not acting in that capacity on this forum), but I'd appreciate your feedback nonetheless.
With respect to non-cash donations, http://www.irs (dot) gov/taxtopics/tc506.html mentions 'fair market value' (defined further here http://www.irs (dot) gov/publications/p561/ar02.html#d0e139) . For, example, the paper that's FAR from staples going on this week, that seems like it should fall somewhere *between* $0 and the pre-rebate cost (i.e. what I could sell it for on craigslist); I am losing utility/'donating' utility by giving it away. Its not as if me owning the paper devalues it, nor does paper tend to lose utility over time. If I sit on it until after the rebate ends, the FMV should sit somewhere below but not too far below the purchase price.
Reading more thoroughly through http://www.irs (dot) gov/publications/p561/ar02.html#d0e139 , if I consider myself a reseller (which is what I'd otherwise do if I wasn't donating/giving away the items), and assuming I don't wait so long that my inventory becomes obsolete BUT wait long enough that the rebate/promotion/etc ends, I should be able to scale the FMV to ebay/amazon/wherever else I'd move it, under the section:
Thoughts on this interpretation? For a practical example,
1. I bought some Nakamichi Bluetooth headphones by rolling some K-Mart points; the net 'cost' to me was $0/negative
2. I have left these headphones new-in-the-box in a safe location such that they shouldn't degrade/become damaged/lose value in that fashion
3. Checking ebay now ( http://www.ebay (dot) com/sch/i.html?_odkw=nakamichi+BT+headphones&_sop=12&_sadis=15&_dmd=1&_from=R40%7CR40%7CR40%7CR40&LH_Complete=1&LH_Sold=1&_osacat=0&_ipg=50&_from=R40&_trksid=p2045573.m570.l1313.TR0.TRC0.A0.H0.Xnakamichi+BT304&_nkw=nakamichi+BT304&_sacat=0 ), I see that this item has sold for >$30 in the last 30 days
4. I head to my local charitable donation thrift store (proceeds support children with developmental disabilities) and drop off the headphones
Could I claim $30 in 'charitable donations'? I agree that I can't/shouldn't be able to claim the price before rebate/points roll, but it feels like under the Inventory standard above, I should be able to claim $30.
Obviously, the yearly net total from this still isn't going to add up to a whole lot, and at the end of the day I could make more money by reselling, but the appeal of walking into my local Alpha Thrift with a big 'ole bag of new-in-box electronics and walking out with a slip saying I've donated $X of value (which is how my local Alpha Thrift/Resource center works) is pretty great. And, y'know, the positive karma of donating.
With respect to non-cash donations, http://www.irs (dot) gov/taxtopics/tc506.html mentions 'fair market value' (defined further here http://www.irs (dot) gov/publications/p561/ar02.html#d0e139) . For, example, the paper that's FAR from staples going on this week, that seems like it should fall somewhere *between* $0 and the pre-rebate cost (i.e. what I could sell it for on craigslist); I am losing utility/'donating' utility by giving it away. Its not as if me owning the paper devalues it, nor does paper tend to lose utility over time. If I sit on it until after the rebate ends, the FMV should sit somewhere below but not too far below the purchase price.
Reading more thoroughly through http://www.irs (dot) gov/publications/p561/ar02.html#d0e139 , if I consider myself a reseller (which is what I'd otherwise do if I wasn't donating/giving away the items), and assuming I don't wait so long that my inventory becomes obsolete BUT wait long enough that the rebate/promotion/etc ends, I should be able to scale the FMV to ebay/amazon/wherever else I'd move it, under the section:
Inventory
If you donate any inventory item to a charitable organization, the amount of your deductible contribution generally is the FMV of the item, minus any gain you would have realized if you had sold the item at its FMV on the date of the gift. For more information, see Publication 526.
If you donate any inventory item to a charitable organization, the amount of your deductible contribution generally is the FMV of the item, minus any gain you would have realized if you had sold the item at its FMV on the date of the gift. For more information, see Publication 526.
Thoughts on this interpretation? For a practical example,
1. I bought some Nakamichi Bluetooth headphones by rolling some K-Mart points; the net 'cost' to me was $0/negative
2. I have left these headphones new-in-the-box in a safe location such that they shouldn't degrade/become damaged/lose value in that fashion
3. Checking ebay now ( http://www.ebay (dot) com/sch/i.html?_odkw=nakamichi+BT+headphones&_sop=12&_sadis=15&_dmd=1&_from=R40%7CR40%7CR40%7CR40&LH_Complete=1&LH_Sold=1&_osacat=0&_ipg=50&_from=R40&_trksid=p2045573.m570.l1313.TR0.TRC0.A0.H0.Xnakamichi+BT304&_nkw=nakamichi+BT304&_sacat=0 ), I see that this item has sold for >$30 in the last 30 days
4. I head to my local charitable donation thrift store (proceeds support children with developmental disabilities) and drop off the headphones
Could I claim $30 in 'charitable donations'? I agree that I can't/shouldn't be able to claim the price before rebate/points roll, but it feels like under the Inventory standard above, I should be able to claim $30.
Obviously, the yearly net total from this still isn't going to add up to a whole lot, and at the end of the day I could make more money by reselling, but the appeal of walking into my local Alpha Thrift with a big 'ole bag of new-in-box electronics and walking out with a slip saying I've donated $X of value (which is how my local Alpha Thrift/Resource center works) is pretty great. And, y'know, the positive karma of donating.