charity Question

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  • Kram BergGold
    Senior Member
    • Jun 2006
    • 2112

    #1

    charity Question

    Taxpayer pays a mover $70 to move two large dressers from second floor of house to the garage. The Salvation Army then picked the dressers up from the garage (they won't pick things up from inside the house). I assume the $70 is deductible as part of the FMV of the dressers. Anyone disagree?
  • FEDUKE404
    Senior Member
    • May 2007
    • 3646

    #2
    On first look

    I would veto. How would that add to FMV, which is likely the limiting value of donation?

    OTOH, after enough appropriate Christmas spirits, I might reconsider....

    FE

    Comment

    • appelman
      Senior Member
      • Jan 2010
      • 1195

      #3
      How about as an out-of-pocket contribution...

      providing a service to the Salvation Army?
      Evan Appelman, EA

      Comment

      • jimmcg
        Senior Member
        • Aug 2005
        • 633

        #4
        Originally posted by appelman
        providing a service to the Salvation Army?
        Exaxtly, donate the money to the Salvation Army and let them pay the mover. They are the recipient of the benefit.

        Comment

        • Uncle Sam
          Senior Member
          • Jul 2006
          • 1461

          #5
          Charity Donation

          This is interesting - it reminds me of an incident I had with a former client years ago.

          He knew that he could get a charitable deduction for a donation of a vehicle.

          One summer he and his wife drove their respective cars to their resort home - as he had to go back to
          work during the week - she didn't.

          So while they're there - her car konks out totally. He gets a tow truck to tow it to their place of donation
          (in their main residence area about an hour away). The following tax season he gives me the donation receipt
          for the car donation, in addition to the towing bill and expected me to take it as a deduction as well.

          There are times when you shouldn't be a glutten pig.
          Uncle Sam, CPA, EA. ARA, NTPI Fellow

          Comment

          • FEDUKE404
            Senior Member
            • May 2007
            • 3646

            #6
            Tugging on the IRS cape

            Let me guess: He also donated each year a couple bags of used clothes worth $1,000 because he "only buys good clothes"??

            I imagine the infamous Form 1098-C might now take some wind out of his sails...

            (Wasn't quite sure if you were avoiding gluten or gluttony ??)

            Nice IRS pamphlet, perhaps worth a bookmark:


            FE

            Comment

            • DonPriebe
              Senior Member
              • Sep 2006
              • 526

              #7
              The old piano is in the basement

              ... How would [moving costs] add to FMV, which is likely the limiting value of donation?
              I would think that the FMV of a piece of furniture that's not readily accessible would be less than the FMV of that same furniture ready to be loaded into a truck. At best, the FMV might increase by the amount of the moving expenses. Deduct the FMV at the point and time of transfer.

              Comment

              • FEDUKE404
                Senior Member
                • May 2007
                • 3646

                #8
                Separate issue

                OP stated the rules were established by Salvation Army. Other charitable organizations may not impose such restrictions. Would the fair market value of the item donated to them therefore be less??

                In any case, the fair MARKET value (what it sells for at store run by Salvation Army/Goodwill) will likely show no adjustment for wherever the furniture "was" beforehand.

                While it is a close call, I just cannot justify increasing the FMV of the donated item by the moving fees. Even moreso if the facts have to fit neatly onto a Form 8283.

                My guess is that many tax folks would just bump up the value of the furniture, and carry on. For my 2ยข worth, with the advent of Circular 230 et al, I just tend not to stick my neck out as far as I perhaps once did.

                FE

                Comment

                • Roberts
                  Senior Member
                  • Sep 2005
                  • 807

                  #9
                  Originally posted by Kram BergGold
                  Taxpayer pays a mover $70 to move two large dressers from second floor of house to the garage. The Salvation Army then picked the dressers up from the garage (they won't pick things up from inside the house). I assume the $70 is deductible as part of the FMV of the dressers. Anyone disagree?
                  I'd increase the value of the furniture by $70 and justify it as an improvement. Since the charity or a buyer wouldn't accept the item the way it was (on the second floor) at top dollar, they increased the market value by moving it to a more attractive location. Just as they would increase the FMV of an antique by moving it from Jackson Missouri to Manhattan NYC. It's all relative.

                  Hopefully their FMV was reflective of this move. By that, certainly they are deducting a reasonable value?
                  Last edited by Roberts; 12-27-2012, 05:25 PM.

                  Comment

                  • ChEAr$
                    Senior Member
                    • Dec 2005
                    • 3872

                    #10
                    Non concurrence

                    with increasing FMV as to physical location.

                    In a business of course relocation of a machine might add to basis, but here is not a business reason.
                    ChEAr$,
                    Harlan Lunsford, EA n LA

                    Comment

                    • Roberts
                      Senior Member
                      • Sep 2005
                      • 807

                      #11
                      Originally posted by ChEAr$
                      with increasing FMV as to physical location.

                      In a business of course relocation of a machine might add to basis, but here is not a business reason.
                      That's just silly.

                      Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. Location is a fact worthy of consideration in any valuation. Put those dressers in an apartment on the 12th floor where the only access is a staircase. Is location relevant when determining their value? It would be if I'm the buyer.

                      Comment

                      • FEDUKE404
                        Senior Member
                        • May 2007
                        • 3646

                        #12
                        And the question was exactly WHAT?

                        Originally posted by Roberts
                        That's just silly.

                        Fair market value is the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts. Location is a fact worthy of consideration in any valuation. Put those dressers in an apartment on the 12th floor where the only access is a staircase. Is location relevant when determining their value? It would be if I'm the buyer.
                        I think the more relevant issue here is the actual FMV of the donated property on the premises of the Goodwill type store, and not on the 12th floor of a building with no elevator.

                        Unless, perhaps, that IS the actual location of the Goodwill store.....

                        FE

                        Comment

                        • Roberts
                          Senior Member
                          • Sep 2005
                          • 807

                          #13
                          Originally posted by FEDUKE404
                          I think the more relevant issue here is the actual FMV of the donated property on the premises of the Goodwill type store, and not on the 12th floor of a building with no elevator.

                          Unless, perhaps, that IS the actual location of the Goodwill store.....

                          FE
                          The relevant issue is the FMV of the dressers on the second floor of his house. Which according to the firm he contracted with $0 as far as they are concerned. It has value to them on when he delivers it to the 1st floor.

                          Comment

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