Almost everyone makes charitable donations from time to time. We all understand that these contributions are one of the best ways to help others who may be in need. But there are a few perks in it for the donor too, aside from that good feeling. If your boat donation is valuable enough it can serve as a way to get a reduction in your tax due. While donating a boat may not be the first thing you think about when wanting to support your favorite charity, there are some great ways it can benefit an organization that goes far beyond a cash reward.
Tax Benefits from Donating a Boat
There are quite a few benefits that you can receive from donating a boat. First of all, these can be quite rewarding if you've followed the IRS guidelines properly. Anyone who makes boat donations can write them off on their tax returns. Just make sure that the organization you choose to support is IRS approved and has a 501(c)(3) designation. While you may wish to contribute to other organizations, if you really want that write off, you'll only be able to donate to such charities.
Make Sure the Paperwork Is in Order
You will also need to make sure that all the paperwork is in order. That means more than just getting a receipt for the boat and attaching it to your tax return. You'll have to complete the forms according to IRS instructions and submit them properly. You also have to satisfy the requirements of the DMV as well, including transferring the title, cancelling the insurance, and collecting any other paperwork that may be associated with the boat.
Work with the Charity
Also, you will want to work with the charity to make sure that everything is followed through. Boat donations are not a single transaction that can be handled in one day. Usually, the organization will accept the donation and then resell it for the money, but they may also opt to use it to help them with their work. Whatever the case, as the donor, you need to get documented information on how the charity uses the boat to their benefit. You'll need that information to file with your tax return.
There are a lot of rewards involved with donating a boat, but before you can receive them, you need to make sure that your contribution is handled in the right way.