Artist donation tax break petition

[-e-]

My artist guild is supporting this petition, and it appears a sensible movement.

Federal: Artist Deduction Bill Introduced in Congress
Urge Your Members of Congress to Support S. 372/H.R. 1120

Americans for the Arts urges the U.S. House and Senate to enact legislation that would allow artists to take a tax deduction for the fair market value of works that they create and subsequently donate to arts organizations. Under current law, artists can deduct only the cost of the materials used to create the works, whereas non-artists can deduct the works’ full value.

http://capwiz.com/artsusa/issues/alert/?alertid=7155976

 

[Steve Worcester]

Damn, you beat me to it.
In looking at the verbiage, I don't like the fact that even under this proposed bill, work donated so that the organization can raise money, would still not be deductable.

 

[-e-]

At least it is a start ...

looks like the subject of the Arts is out-of-scope these days. my congressional representative doesn't have anything related to the Arts in the list of possible subjects on her on-line email system.

perhaps if enough people spoke up, there would be a shift in awareness...but then, probably not...but i like to dream.

 

[JimQ]

Unless you are going to include the difference between the cost of materials and fair market value as taxable income, there is no deduction beyond materials regardless of the type of work you do. There is no deduction for increase in value due to your own labor, unless you want to pay income tax plus 15.3% self employment tax on it. Besides fair market value cannot be determined until an identical piece sells, and art generally is not identical.

In regard to non artists who bought a piece of art, they can only decuct, "the lower of cost or fair market value". Except under certain special circumstances.

When someone does volunteer work, only their out of pocket expenses are deductible. I have clients that asked about what records they needed to keep and what was deductible in regard to traveling to N.O. to help with restoring medical services. (Airfare, lodging, laundry expenses, meals away from home, and any supplies they actually paid for, and keep the receipts and a diary.)

BTW, I am a tax preparer who has spent most of the summer and fall teaching tax classes to experienced preparers including CPA's and IRS enrolled Agents.

JimQ

 

[Mark Mandell]

Let's Not Forget

That the current limitation on the deduction came about, in large part, because of the abuse, actually fraud, that was perpetrated by some "donors". As an artist I rankled at what I saw as unfair treatment of artists. But as a taxpayer, I was pissed at what I saw as a conspiracy of the rich and successful to pay less than their fair share through sham valuations.

A paradox, indeed.

"Fair Market Value" . . .? hmmm . . . . . So how much will it cost the artist to get 3 independent appraisals of the piece to be donated, and what will he/she do and spend if the TaxMan disagrees?

M

 

[spinsdawood]

If your concern is taxes take a look at the Fair Tax bill presently before Congress. It would eliminate the IRS and all the crap we go through in the name of Taxation. It is Fair Tax Bill H.R. 25. It is simple and to the point so much so even I understand it. Chech it out, wat's there to loose?
Jim :cool2:

 

[underdog]

sheer unmitigated weight of being Bureaucracy...

I begin to wonder just how big a bureaucracy can get before it collapses under its own weight.

I'd love to see the tax code simplified. It's almost not worth "rendering unto Caesar" in order to get into business any more. The smaller Mom and Pop outfits just don't have the wherewithal to abide by all the regulations, codes, etc... before they just can't make ends meet.