Yes, I didn't add this in my post. You MUST keep receipts of the cost of the fabric,thread, etc.
Originally Posted by ckcowl
Some resources to check out.
Tax deduction info for charity quilting
Goodwill valuation guide (not for stuff you make, but good for used items you donate anywhere)
and the IRS Charitable Contribution regs (Publication 526)
As a side note, the IRS does not make tax law. The IRS is not thinking of taking away deductions. Congress makes tax law.
Originally Posted by qwkslver
You can't deduct any thing for the time you spent making a quilt. You can deduct the actual cost of the materials you put into the quilt.
Being able to take deductions has nothing to do with what tax bracket you're in. It's simply a matter of your itemized deductions adding up to more than the standard deduction.
I did taxes for 8 years. During that time they tightened up the rules for taking charitable deductions.
I work with my local Project Linus chapter, and we offer receipts to people who make donations of fabric and yarn and other materials. Usually it's someone who's quit quilting or the relatives of a deceased quilter. Roughly half take a receipt, others do not. I don't think any of our blanket volunteers ever ask for a receipt.
Me, personally, I can't even imagine keeping track of what fabric I've bought, what's been given to me, what I've picked up at yard sales, what I've used for charity and what I've used for myself. Like others said, you can't write off your labor, only the materials, and the labor to me is the biggest part. I consider it all a gift from the heart...
We deduct just the costs involved with material, etc.
I did a Quilts for Kids kit and sent it back along with a quilt of my own. They did not send a tax receipt. If I wanted to itemize a deduction like this on my taxes (we have not itemized deductions as long as I can remember; the standard deduction always seems to cover us), then I would have taken a photo of the quilt I sent and kept receipts for fabric, batting and thread that went into the quilt. You can deduct only the materials that are donated; no time or labor.
Maybe it depends how seriously you are into making donation quilts. I never thought it worth the time to document what I donate. If I were going to make and donate a lot of quilts, I think I would try to keep materials for donation quilts separate from my own quilts and develop a filing system for receipts. Quilts for Kids did email me a thank you after they received the quilts; I would make a copy of that for my filing system too.
Think about Goodwill. When I drop off items there, they give me a receipt but it does *not* document what I gave or what its value is. I am supposed to attach a list of what was in my donation. Also, there are guidelines for valuing donations. If I buy a pair of jeans for $30 and then donate them to Goodwill unworn, I do not think I can value the donation at $30; maybe half that if the tags are still on? A lot of stuff is valued at only 10% to maybe 25% of original price.
(Edit: Donation quilts are able to be valued by means of original cost of materials. Hope I didn't confuse anyone with the Goodwill example.)
Working with a guild is a good idea, or you can take it to any 501c organization and get them to give you a receipt. Normally all of the abuse shelters qualify - I know our group does a lot for them.
hi! i am collecting quilts (for sandy victims), any donations to some senior citizen ladies in my community center who lost just about everything in sandy. i, we, are not giving any tax donation receipts to anyone who donated. and there were quite a few wonderfully generous people. both with their time and money.
Did you ask for a tax receipt? It's hard to tell from your post if you asked for one, or waited for one to fall into your lap.
I've made a lot of quilts for charity, but never bothered to ask for receipts for tax purposes. I may be wrong, maybe Scissor Queen can clarify this for me, but it just seemed that the tax benefits weren't worth the effort. (Of the receipts, NOT the donations. They're totally worth it!)
It was non caring of the group not to ask if you wanted a receipt. It never crossed their minds to ask during all that time if you knew you could have one? It would make me wonder how are they managing the whole operation.