Tax time: can I deduct charitable use of my boat?
Volunteered my boat this summer for some charitable events. Had a whole week of use. Registered 501c charity.
Can I deduct both expenses to drive boat to/from event (wear/tear/fuel) as well as use of boat (hours, depreciation)? Had some broken equipment during same event which I had to replace- can I write that off as a donation? Tried to search online and everything is about boat donation. I'm keeping my boat, but want to extract any money from the IRS if legal and permissible. anyone with any experience I appreciate. |
That is a good question. We have done 2 Wake the World events over the last 2 years and will be volunteering for 2 more events this year. If you find out any of this, please share and I can share with the other Wake the World volunteers. I am sure it is, but just weather or not it is worth the time and justification and red flags it might raise to trigger an audit.
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I have asked about this and per my accountant just lump the miles into the others you keep track of for the year. As for hours on the boat and gas he was unsure.
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I'm sitting in a tax class as I type. I just read this to the class. The instructor said pretty much no. She said maybe if you have something from the registered 501c charity, stating what you did, what it cost etc. Otherwise in an audit your going to get it tossed. She said if you have a receipt then maybe gas. Depreciation hours, etc are always going to be a big no.
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Maybe wake the world could come up with a template form for this? Just an idea.
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Well that's kinda what I expected, but it sucks. A whole week of hours on a boat is worth something in depreciation. Businesses get to deduct depreciation, and miles to and from lake are deductible (but of course at standard rates which si way less than it costs to actually tow the boat).
I hate the gov't every single day, but especially in late March and early April..... |
You could ask the charity for a receipt for the reasonable value of your boat use. Skip depreciation, that's just fishing.
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How many of you turn I your gas receipts at the end of the year? You can get back the road tax that is associated with fuel since it's not used for on road use.
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As far as the tax instructor. I can see where she's coming from, but I kind of disagree. just because the IRS might disagree and disallow a deduction doesn't mean it isn't legitimate and something that you COULD choose to include.
That said, the charity that the OP mentioned is a "qualified" organization. Good, first criteria satisfied. Next, you need to have documentation of your contribution. That could be a memo from the organization acknowleding your contribution. Certainly the gas receipts would be a given if you're going for fuel expense. You don't get to deduct your time. I'd skip the idea of wear and tear or depreciation on the boat. But fuel I would most certainly do if you have the receipts. Heck, even if I didn't have the receipts per se, I'd keep a copy of my credit card statement and use that as backup should your deduction ever be questioned. Remember, the only time you'd actually have to furnish said documentation is if you were actually audited. So really, if you have a legit contribution of your gas to this charity, then what you're really doing is weighing the value of that deduction vs the risk that it could increase your chances of an audit and in turn have the hassle factor. So if you're one that would just as soon avoid an audit, you can certainly not claim something that is likely to up your chances. For example, the "home office" deduction is a huge hot buttom that will increase the chances of an audit. Many who legitimately have a home office skip the deduction because they simply don't want to increase their audit risk. Those are my thoughts. I'm NOT a tax specialist by any stretch, but I am a CPA and am happy to share my thoughts. Here was an article that I thought was interesting on the topic: https://ttlc.intuit.com/questions/18...s-can-i-deduct |
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What DatTexasBoy is mentioning is that embedded in the fuel that we're paying for at the local gas station are taxes that are specifically associated with ROADS. Obviously our boats don't benefit from road improvements, so many states allow you to apply for an account where you can remit to them a form with your gas receipts and they will refund you the portion of the gas that would have gone towards road improvements. In Washington state, I think it's somewhere in the neighborhood of 10 cents per gallon, but I can't remember for sure. I've got my account set up and have been saving reciepts. Once I get enough of them to make it worthwhile, I'll send them in and get my tax money back. (note: in WA you can go 13 months back with your submissions so don't wait TOO long). Here is some info for Washington State. http://www.dol.wa.gov/vehicleregistr...ftrefunds.html So it doesn't really relate to Charitable deductions of our boats, but it does relate to minimizing the tax we're paying. |
^^^your right it doesn't really apply to the OP question but I thought everyone would like to know this. I just found out last year.
Cheers |
@dattexasboy. Do you know if here is Texas we have to set up an account with the state like Trayson mentioned about In WA.
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I don't believe our state has a get your money back for non-road use option. I've looked before, it seems to be state by state.
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I turned my receipts in last year to my CPA. Not sure how much I got back. I do not think you have to set up an account. I just turned my tax stuff in again yesterday and included it again this year. I will check with her when I pick it up.
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Took me about 30 seconds of google searching. How you have to take me out on your boat as repayment when I come and visit Texas this summer! EDIT: Should I be scared to take you up on it if you do offer to take me out on the water???? #dippingboardracks #thevoids |
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You could talk to the organization about making a cash donation to support the ski program which should allow them to provide you a letter substantiating the donation to a valid 501(c)3 organization. The organization could then pay mileage and fuel for the days event.
You are not going to get depreciation or maintenance deductions unless you are set up as a business but if the business doesn't make money you will likely have a tax problem. Personal use of the boat could also cause tax problemsin a business. |
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