Tracking/Recording expenses for Charity Quilts
 

In the past, I would do a piece or two for a charity project - but this year, to date, I have made and donated 3 complete quilts - with two more in progress…...

Cost for fabric, batting, quilting thread is mounting…...

What method to you use to track these costs for income tax purposes? How do you store or catalog receipts, etc.? Do you use a software expense management program, or just handle this manually?

Really appreciate your time and responses. THANKS!!

Well first I don't take it off my taxes. too much trouble and if I can give I do. Second a serious amount of material is donated to me for such projects. Mostly it is just my time and as I am retired I have extra time on my hands especially during the winter months. Mostly I only have to buy batting and thread plus the sweatshirts and zippers I use to make jackets. A group of us also give Christmas gifs to around 60 kids. I probably spend around 600.00 each year on charity work. I pay to have my account do my taxes and if I used charity deduction it would mean another page to charge for. I do know you have to keep pretty close records (receipts to buy and when you donate and who you donate to. Good luck. If you use CPA contact him and ask what you should be doing.

I make a lot of quilts that get donated. What I do is take a picture of each quilt. Document how large it is and how much fabric was used in the making as well as the amount of batting purchased for each project. I figure in how much thread (approx) was used (ie a spool, half a spool, 2 spools, etc) I estimate how much 505 spray was used. I have printed up a cost (from JoAnns, not on sale) for the batting, 505 spray, print up a cost of the thread you use. You can even print up an advertised cost of fabrics. Then I say this quilt was x large and used 6.5 yards of fabric at $10 a yard (yes I need to increase that cause fabric costs more than that now) 1 spool of thread at x etc. I print up a black and white picture of the quilt or quilts if there are multiples going at the same time and the sheet where I have my "costs" For 2013 my "costs" were over $2,600 at $10 a yard. My accountant has accepted my figures (it helps that she is a quilter too!)

Most of the time the fabric comes from my stash and I don't have receipts for that fabric. But replacement cost is acceptable. You cannot charge for your time.

I keep a folder in my filing cabinet named (Quilting Donations) in that folder I drop receipts that are for materials I use for donated quilt items. I also write up a regular 'bill of sale' style invoice documenting the quilt- size, fabrics used, theme, charity donated to, date made, date donated, and a picture of it. I keep a small journal in my purse- when I spend money I know will be for a specific donation project I write down the project and keep a 'running tally' of the expenses. I save all of my fabric, tools, patterns, materials receipts regardless of what they are for, so, if I use fabric from my stash for a donation quilt I can easily look up how much it cost, how much of it I used for the donation quilt. so, when I start a new one I can easily figure out the cost involved. I do have an accountant do my taxes every year- he is always very happy with my 'organization' :) I generally donate between $600 & $700 in quilting every year- and depending on the place I donate to sometimes I get a tax receipt from them for the quilt- but if not I have a good record of it on my own.

Ask the organization for a charitable donation form. YOU fill out the "value" . Use the form for the tax write off.

sandy

I don't think you can write your time down as labor as the value of the quilt but certainly the fabric, batting, adhesive spray and thread used can be. Sounds like a lot of good ideas. I too get a lot of fabric given to me by my friends and as long as I have a little pin money, I don't mind spending it for the charity quilts.

I just kept an ongoing set of spreadsheets, back when I had enough to pay taxes [LOL.] Medical, mileage, donations. and other. I didn't charge for my time. On the donations spreadsheet I listed what each expense was for. It was good enough for my accountant because I kept up the spreadsheets as I went and kept receipts separated into categories and by date so they were easily verified.

I keep the receipts for fabric and thread; along with a count of how many quilts are donated. The batting is purchased by our guild so I don't include that in the mix. At tax time, I include the receipts and count and give that to my accountant.

My charity quilts are not a business to me....I just make, give, not on a regular basis, just if I am in the mood so maybe that is the difference....

making 'charity quilts' is really not a {business} for any of us- but, when you donate a lot to charitable foundations- whether it is quilts or checks a percentage of your donations are tax deductible- you are allowed a certain percentage of your net income to be used for charity- and if you itemize your taxes those deductions can help *and they add up over a year* ; so, if you send a $25 check to the American Lung Association, one to Breast Cancer research, one to St. Judes, make a quilt for 'linus project' (valued *cost of materials =$50) you have $125 in tax deductible donations...if over the year you 'give' 4 or 5 quilts the deduction's really add up- so, it has nothing to do with making 'charity a business' if has to do with planning for taxes each year. really doesn't make a difference if its cash, quilts, food, what your donations is- as long as it is to legitimate charities.