Charitable Cont: Services Performed

[EA_TAX]

Client is retired with pension and an active volunteer fire fighter. His town built a new firehouse this year and he donated 6 months of his time 30 hours week for free doing construction work. This was a public works bid job. The construction vendor that won the bid allowed my client "work" for free along side his crew and values his services at $30,000 verbally but has not put it in writing. I'm saying he needs a statement in writing from either the vendor he worked for or the Chief of the Fire Company to be an allowable deduction. Any thoughts?
Thank you
EA_TAX NYS

[taxmandan]

TTB 4-15 reminds us that personal time or services are NOT deductible as a charitable donation.

[bgiez]

Services are not a charitable contribution deduction....

Client is retired with pension and an active volunteer fire fighter. His town built a new firehouse this year and he donated 6 months of his time 30 hours week for free doing construction work. This was a public works bid job. The construction vendor that won the bid allowed my client "work" for free along side his crew and values his services at $30,000 verbally but has not put it in writing. I'm saying he needs a statement in writing from either the vendor he worked for or the Chief of the Fire Company to be an allowable deduction. Any thoughts?
Thank you
EA_TAX NYS

It sounds like the construction vendor was really the recipient of the contribution, and I would guess the vendor is not a charitable organization, anyway

[JohnH]

The contractor is probably valuing the work for purposes of internal accounting or some reporting required by the project (cost plus or something of that sort). Whatever his reasons, it is irrelevant insofar as the client is concerned because, as has already been stated, there is no charitable contribution deduction available to him.

[FEDUKE404]

Cannot deduct value of donated personal services

As John and others have stated, there is NEVER a possibility of claiming a charitable deduction based upon the value of a person's time and/or job skills. Basic Tax Rules 101.

There may be a slight smell as to exactly what the contractor was doing, namely "allowed" the guy to work. Are you kidding me?!?

FE

[MAMalody]

I can't speak to this case, however, it happens all the time with churches. They need a general contractor to run a job and all that goes into it and the contractor(s) allow a credit for the work the church performs. The church can do anything from clean up the site every day to the actual electrical, plumbing, etc. This is not uncommon.

[EA_TAX]

TTB 4-15 reminds us that personal time or services are NOT deductible as a charitable donation.

Thank you to all

[JohnH]

Great point Mike. I had forgotten about that. The last time our church undertook a building project, the GC made a provision for certain segments of the work which could be done by volunteers. It even included some of the trades, provided the person doing the work was properly licensed and worked under the GC's supervision.

The agreement was that if the work was not undertaken and completed by a certain time, the GC would bring in their subs and the credit would be all or partially surrendered back to the GC. We made it clear to church members that they would not be able to take a tax deduction for anything other than out-of-pocket costs.

But I can see how someone who learned of the value placed on their volunteer work might come to the incorrect conclusion that they were entitled to a tax deduction.