Donating Used Office Equipment to a Not-For-Profit

If you donate used office equipment to a not-for-profit organization, can the not-for-profit send you a receipt for the fair market value of the gift?

The short answer is: it depends. First, it is important to remember that valuation of the in-kind gift is the responsibility of the donor. The donee’s responsibility is to make sure items being accepted correspond to the mission of the not-for-profit. Keep in mind the following guidelines:

Gifts over $5,000 contributed by an individual: The donor must obtain a written independent appraisal by a qualified appraiser of the property to be contributed. Per IRS regulations, the appraisal must be made no earlier than 60 days before the date the gift is contributed. If the property to be donated is new, an invoice dated within 60 days of receipt of the gift will be adequate for valuation.

Gifts over $5,000 contributed by a company owner or corporate officer: An invoice is not adequate valuation when the in-kind gift consists of goods from the owner of a company or an officer of a corporation. In these cases, the price of the goods must be verified against published prices, such as sales brochures. The donor must supply appropriate documentation to the foundation.

Gifts of $5,000 or less: Typically, the donor or the not-for-profit would accept the donor’s estimate of the fair market value (this can be audited by the IRS). If no value is provided by the donor, often a value of $1.00 is assigned.

In order to claim a tax deduction if you are claiming more than $500 in contributed property, the donor must file IRS Form 8283. For donated property with a fair market value greater than $5,000, an appraiser must sign Part III of Form 8283. For all contributed property more than $500, the donor must also submit the form to the donee, listing the donor’s name, identifying number and description of the donated property. Once the transfer of the property is complete, the donee will complete Part IV of Form 8283 and return a copy to the donor. Email Rea & Associates help or for more information.

This article was originally published in Illuminations: Facts & Figures from people with a brighter way, a Rea & Associates enewsletter, January 6, 2010.

Note: This content is accurate as of the date published above and is subject to change. Please seek professional advice before acting on any matter contained in this article.