I have an idea...

mitchk · Jul-08-2009, 07:43 PM

Gents,

Today we visited Westport to discuss the event with the Chamber of Commerce and straighten out a few issues. One thing came to mind that would involve folks fishing for tuna out of Westport. For whom it applies what do you think of donating fish in exchange for a tax deduction? The basic process would involve you providing your excess fish to a local facility that cans and then sells the fish. You would receive a receipt for a tax deductible donation to the WTC equal to the dock value of the fish donated. The WTC benefits from the proceeds of the sales.

Thoughts?

Chasin' Tail · Jul-08-2009, 09:31 PM

are you talking about the fish caught at the WTC event or the fish caught before the event when we are out fishing??

mitchk · Jul-08-2009, 09:40 PM

No change to the original plan on game day. All fish caught then will be picked up and canned via NWH.

This idea, once in place, would allow anyone to donate fish all season long. They must obviously meet the quality standard but would provide a convenient means for guys to hand off extra fish at the docks. There are some guys who go out a lot and could easily donate a lot of fish over the entire season if there was a mechanism in place. We currently have a verbal agreement so I'm running the idea up the flagpole to judge interest before going forward with the rest of the back end work.

quickfish · Jul-08-2009, 10:14 PM

Sounds Like a fine Idea! will they take salmon too? Does the tax right off work the same as if you went to Good Will, and donated some fine used but not abused stuff?

KillerBeee · Jul-08-2009, 10:43 PM

I'd be all over that for sure.

mitchk · Jul-08-2009, 10:44 PM

We still need to work out the actual details since there might be an advantage to sending out one big receipt at the end of the year vs one per instance.

We did not discuss salmon. However, that should be viable as well. We kept the discussion to tuna for simplicity. In all honesty, we are trying to establish interest level to judge if the idea is worth the time and effort to put in place.

We would need to pay a lawyer and get the books straight as well as create the paperwork. Like the rest of this stuff, it's just a lot of work but if the interest is there, we can work out the details.

wavechaser · Jul-09-2009, 01:02 AM

Have you talked to a income tax specialist CPA about this? I'm no tax expert, but I took several tax classes and I'm doubtful that the write-off would hold up if you got audited. The goodwill donated write-off is a different scenario because a person buys the goods for full retail, then later writes off the donation at current market values, which is obviously much less.

With donated tuna, I guessing that the write-off could only amount to the lesser of:

the wholesale value of the tuna; or,
the expenses associated with catching the tuna (gas, bait, tackle, etc.)

I would ask a CPA if an individual taxpayer could write off recreationally caught donated tuna. I am sure that a commercial fisher with some type of business entity could write off donated tuna, but I don't know about someone who catches fish for fun and doesn't expect any monetary benefits.

Even though the expenses most likely are always higher than the wholesale value of the tuna, a person would need to hold on to all receipts from the trip and keep detailed records to prove that the wholesale price was less than the boat expenses. Not worth the effort IMO.

mitchk · Jul-09-2009, 03:54 AM

I have spoke with a couple reasonably informed individuals (they do taxes) and received different responses. One was similar to what you say and another was not as concerned. This is the reason I'm laying the basic concept out there to judge interest instead of saying "YAY! We have a great program!". We are not going to roll out anything until we are sure of the implications. I don't mind doing some legwork if there is interest and that was the point of the post. I'll try talking with a couple tax attorneys and see if I can get a consensus.

mitchk · Jul-09-2009, 06:13 AM

For the sake of clarity, each persons tax situation is going to be different. This situation isn't different than the registration donation or any other donation you make to a registered charity. As I understand it, the charity has a responsibility to provide a receipt for donations above $250 but that does not mean the individual receiving it obtains the full benefit. Depending on the individuals circumstances, they may not receive some or any benefit depending on a number of factors. I'm not a CPA or tax attorney and I didn't stay in a Holiday Inn Express last night so I can't dispense tax advice. I'm just sharing what I understand. In the end, it's up to the individual to settle their own matters.

I would hope that no one would be approaching this issue strictly from the "how much is in it for me?" angle. Rather, I would hope that individuals would be asking themselves if they support the underlying causes and would appreciate this mechanism for doing so. Getting a potential tax benefit is nice but hopefully not the key point. There are a lot of folks who are stepping up because they want to make difference in causes they believe in. That's certainly why I'm putting my money and time on the line. If there is enough interest, we will do what we can to provide guidelines to help folks avoid pitfalls as a courtesy. The original question is regarding whether or not the interest level validates the effort.

The bottom line is can we reasonably hope to have more than 100 fish per season donated under this program if we put it in place. If so, it's worth putting the time and money into doing it right.

outtadablu · Jul-09-2009, 09:49 AM

The organization the fish are being donated to needs to be a designated charitable organization in the eyes of the IRS. For record keeping purposes, it would be much easier to account for the dock value of the fish vs. keeping all your receipts from each fishing trip and allocating based on number of people and number of fish caught. You would keep the receipt/ticket for the donated fish, with each person fishing getting one for the fish they are donating that day.
When tax time rolls around, those receipts would be included with your other charitable deductions for the year and taken on Sch A of your Form 1040.

Matt S · Jul-09-2009, 10:27 AM

What about donating the fish to a food bank?

polywave · Jul-09-2009, 02:04 PM

Quote:

Originally Posted by mitchk

...I would hope that no one would be approaching this issue strictly from the "how much is in it for me?" angle. Rather, I would hope that individuals would be asking themselves if they support the underlying causes and would appreciate this mechanism for doing so. Getting a potential tax benefit is nice but hopefully not the key point. There are a lot of folks who are stepping up because they want to make difference in causes they believe in. ...

This is the angle I would persue, leaving out the tax write off portion. If tuna fishers have extra fish for donation, well knowing how generous they are I would bet they would just donate it.

Wouldn't that be easier and more fullfilling than trying to calculate a tax write off?
Poly