Client Fundraiser wants you to donate Tax Preparation

[Sparky]

A good client would like me to donate a "free tax filing" for a silent auction. I do not do this for my church because the one time I did it only drew a $5.00 donation! (many years ago before I became an EA and had experience but still it was insulting)
Any suggestions on how to word the gift certificate?
In other words I would like the fundraiser to receive a decent amount, but I don't want to work three hours for a high maintenance business if the fundraiser is only going to receive $50 - $100.
I don't really need new clients so that angle is not really desirable either.
Thanks for your thoughts

[TaxGuyBill]

First question: Do you actually want to do it?

If not, in my opinion, you could say something like "No, but I would like to make a monetary contribution ... how do I do that?"

[Uncle Sam]

Client Fundraiser

As a professional person - you aren't in business to "auction off" the value of your services. The winner will only remember that he/she came to you via the auction and will probably give you trouble the subsequent year in arranging a fee.

Also realize, that when IRS audits - one of the first questions asked is "Do You Barter"?

I wouldn't do it if I were you.

[kathyc2]

I've done them in the past and said something like "Entitles bearer to no charge preparation of individual tax return or x off of a business return"

The "x" will have a indication of the value of what is being offered.

Not sure where the comment about bartering is coming from. What is the preparer getting in exchange for the no charge prep?

OP said not looking for new business, but for someone that is I found this an excellent no out of pocket cost way to advertise.

[ATSMAN]

I agree with Uncle Sam. I did something similar at a "tax clinic" several years back, doing free tax returns with a group of other preparers and the following year I must have got half a dozen people booking an appointment and then when I presented the invoice they were shocked that I would charge them. I had to severely discount my fees just to extricate myself.

So if you get a call the next year, make sure they are not expecting free service.

[kathyc2]

I've had a totally different experience. I can think of a few that came to me via silent auction that are still with me some 15 years later.

To avoid the expectation of low fees in future years you could present an invoice that shows full price fees and then a line with 100% discount. That way they will know what to expect.

[ttbtaxes]

It would have to be a fairly straight-forward return for me to do pro bono. I'd also need to know whether it would be covered by my malpractice carrier.

[Lion]

I have donated a one-hour consultation or $XXX (my hourly fee) off tax preparation to my church's silent auction, but only a couple times. I required a minimum bid, don't remember, but probably at least half my minimum fee if not full. Also, very clearly posted Valued at $XXX on the bidding site.

My invoice stated full price with a line for their silent auction discount.

[Burke]

I have had beauticians do this, and for whatever reason, they think they are eligible to deduct the "donation value" as a business expense on their returns. For those who have done this in their tax practice, how do you sign off on the return, since you are not a paid preparer?

[taxea]

I agree with Uncle Sam. I did something similar at a "tax clinic" several years back, doing free tax returns with a group of other preparers and the following year I must have got half a dozen people booking an appointment and then when I presented the invoice they were shocked that I would charge them. I had to severely discount my fees just to extricate myself.

So if you get a call the next year, make sure they are not expecting free service.

They should have been told when they booked the appointment that the tax prep would not be free.

[ATSMAN]

They should have been told when they booked the appointment that the tax prep would not be free.

Good point. The receptionist did not know that these people came to a "free clinic". This was my first experience so I consider it a learning process.

[mastertaxguy]

Donation of tax prep services

Why not buy an item, and donate it, for a silent auction equal in value to your services for a 1040 w/Sch B and A? You probably could or should claim it as an advertising expense.

Or buy an ad for the program?