This column aims to provide you with answers to perplexing questions that arise in the operation of a non-profit organization. The responses are to be perceived as guidance and suggestions, and not as legal advice. You should always seek legal and tax counsel where you feel it is appropriate. Section 170e3 of this code creates an enhanced deduction for businesses that donate appreciated property. However, the inventory or other property may have a fair market value higher than its cost.
Equipment used by a facility providing service to the needy also qualifies.
The same acknowledgement requirements that apply for any donations still applies under 170e3 donations. The occasional or rare sale to the general public to reduce excess inventory would also not disqualify the enhanced deduction for the donor. Contact the company and tell them that they might save money by donating slow-moving items prior to marking down the price. Your tax advisor can help with this solicitation. This column aims to provide you with answers to perplexing questions that arise in the operation of a non-profit organization.