Photography Donations

[mike_slaun]

<p>I am an amateur photographer who is looking to make a photographic donation of some photo's I took on my own time to my local library.  I would also like to attempt to legally obtain a tax write off for doing this.<br /> <br />I have learned a lot from other parts of thi s forum, but I still have some questions since those answers are more geared to ward those who are professional, not amateur.<br /> <br />I understand that I cannot simply self-appraise my work at $100/photo and write it off.  It appears it's more for the actual physical costs of the photo. Also, I hear I can't really claim time photographing or post-processing, or can I?  Here are my associated costs:<br /> <br />Film:<br />-Travel expenses to the destination  (Gas for travel less than 30 miles, tolls, time to travel there, not exotic travels across the world)<br />-Time to shoot the photo<br />-Cost of wear on my camera<br />-Cost to get film developed<br />-Cost to have print made or film scanned to digital CD<br />-Time to post-process the photo to it's final outcome<br /> <br />Digital:<br />-Travel expenses to the destination  (Gas for travel less than 30 miles, tolls, time to travel there, not exotic travels across the world)<br />-Batteries?<br />-Time to shoot the photo<br />-Cost of wear on my camera<br />-Cost of my time to transfer from camera to computer<br />-Time to post-process the photo to it's final outcome<br />(will not be providing prints on digital works, only image files)<br /> <br />QUESTIONS:<br />-What parts of the Film process could I write off? <br />-What parts of the Digital process could I write off?  It seems like there is less that I could claim on a digital photograph without the associated film costs.<br />-On the above two, IF I can claim time spent, what kind of hourly rate could I charge for taking the photo and processing it while being an amature and traveling to these locations for my own portfolio - not specifically to take shots for the donation?<br />-When it comes to licensing, would I be eligible for a tax write off if I granted them usage of the photos under a Creative Commons license while I sill retain the copyright or would I need to give them full ownership/copyright rights of the photograph?<br /> <br />Oh, and of course I understand that I should be contacting an accountant, but for now I'm just curious in some general feedback on these questions.<br>

Thanks<br>

-Mike</p>

[RobertChura]

<p>If your work sells for 100 dollars then that would be the donation price (logical thinking only <strong><em>not</em> </strong> IRS thinking). I believe if audited you might have to prove your work sells on a regular basis for a particular price.</p>

<p> </p>

[mike_slaun]

<p>Robert, thanks for the quick response.   $100 was just a hypothetical answer.  I've actually never sold any work before so if audited, I have no proof to fall back on.   <br>

A lot of what I'm saying is built off of what I learned in this thread:  <a href="http://www.photo.net/bboard/q-and-a-fetch-msg?topic_id=23&msg_id=0018HB">http://www.photo.net/bboard/q-and-a-fetch-msg?topic_id=23&msg_id=0018HB</a><br>

So when I'm hesitant about just making up a price for what I think is the value and instead only claiming only materials (and maybe time spent), that is why.<br>

So I'm afraid that I'd have to justify the price with actual matrials (and hopefully time). </p>

<p> </p>

[jaybee]

<p>I'm a CPA who does mostly individual income tax work. Although you've answered your own question (I understand that I should be contacting an accountant), I'll add a little to your answer.<br>

Basically, you are allowed to deduct your costs for producing the images you create. The gray area is defining what those costs are. If you take the list to a half dozen tax practitioners, you'll probably get a half dozen answers about what is deductible. Some of the items are obvious, e.g. paper and ink or film processing costs, but others are questionable.<br>

I definitely recommend you follow your own answer and contact an accountant.<br>

Good luck.</p>

[Charles_Webster]

<p>I donate photographs and photography services to my local animal rescue organization. My tax preparer (an enrolled agent) told me I could claim the "full retail value" of any photos I donate, but cannot claim any time or service related costs, i.e., driving time, session charges, etc. In other words, no deduction for my time at all, only for actual materials donated.<br>

<Chas></p>

[joshroot]

<p>I think Charles's answer is the most common thing you will hear from accountants.</p>

[mike_slaun]

<p>Thanks guys,<br>

Yes, I agree the most with Charles answer.  I guess you can try and push it farther than that, but I'm afraid it might depend on your luck and your accountant.  So I would proabably play it safe and only charge of physical aspect things.<br>

BUT, what about digital photos then.  How you you charge for them since you can't touch it?</p>

 

[Charles_Webster]

<p>My preparer said "full retail value" so if I give a CD of files, I write off what I would have charged retail for those files. In my case, that's about the same as my largest print, but I'm not dealing with reprints etc.</p>

<p>As an aside, when I give files, and the right to print them, I print that permission ON THE CD itself, in the form "Charles L Webster grants permission for <name> to have prints made from these copyrighted pictures"</p>

<p><Chas></p>

[ed_gerken]

It's probably not worth the effort. In order to claim a donation, the receiving entity must be non-profit. A city-funded library

might meet that requirement. Next up, the donation is deducted using Schedule A Itemized Deductions of your IRS forms. If

you elect to itemize, you use the figure from Schedule A instead of the "Standard Deduction," which varies according to how

you file, that is, the Standard Deduction is $5,150 if filing as Single, $10,300 for Married, etc.

 

In other words, you need to show more things on Schedule A than the Standard Deduction for it to make any difference.

Basically, unless you have huge medical or other allowable itemized expenses, most folks are way better off just using the

standard and never bothering with keeping track of all the receipts and the work of filling out another complicated IRS form.

 

Now comes the kicker. Assuming you actually can use Schedule A to earn a greater deduction than the standard amount,

and you are taxed at the 30% rate, your final tax is reduced by one-third of the amount. So, unless you're giving a sizeable

amount, or have other allowable items, it's probably not going to improve your tax picture one thin dime.

 

You didn't specify how many prints nor their size or materials cost, so I'm assuming it's at or below the $100 figure you

mentioned. If it's $100, you'd "save" a whopping $30 on your taxes. If the accountant bills you for the

advice, you might end

up in the hole on the entire deal.

 

Perhaps the library would provide a statement of value and you would use that to determine the amount. That's what the museum here does.

They may take your cost or use their own method of appraising value and may even have someone on staff that provides that info for any

and all donations. Maybe you also paid for framing, that might also make the figure higher.

 

Since I'm self-employed, I fill out the long form 1040A and Schedule C. It used to have a direct line for Donations, where we could take the

cost of our

annual tithe to the local museum and charities. That line is no longer on that form. I still keep track of the amounts, but I

can't deduct them. Perhaps 1040EZ is different, but I doubt it. I think that if you itemize on Schedule A, you then need to use the 1040A long

form, so it may change the way in which you're used to filing. You'll have to take a look at the forms and decide for yourself if it's

worth the bother.

 

I'm not a CPA, I do my own taxes and I never stayed in a Holiday Inn Express, so do your own checking into my advice! ;^) You can always

call the IRS hotline and see if they can help guide you.

 

-Ed

[Spearhead]

<p>In order to claim a donation, the receiving entity must be non-profit.</p>

<p>I have been told that the receiving entity must be a 503©.  While you can have a charitable organization that qualifies for 503© and donates to the library, the library itself is a government organization and I don't believe that a government organization can qualify as a 503©.  I think the question you have to answer first is whether there is any way to declare this for a tax deduction.  Call a good accountant.</p>

[eric merrill]

<p>Good luck trying to claim more than the cost of materials. Assume that there are buyers willing to pay $100 for your photo, and have you $10 of expenses creating that print.<br>

<br /> You could either donate the photo to the charity of your choice, or you could sell the photo to a buyer and donate the $100.<br>

The end result is the same. If you are going to claim that you donated $100 to the charity, then you also have income of $90. It's a wash. That's why no matter what price you put on your own work, you can only deduct the expenses. Otherwise, you'd also need to claim the same inflated price as income.<br>

Yes, you can donate time to charities. But you can't write it off your income. You can only deduct hard expenses.<br>

Well, to be more precise, you can deduct anything you wish. But you're asking for audit trouble if you deduct unallowed ones. :)</p>

<p>Eric</p>

[mike_slaun]

<p>Thanks for the help everyone!</p>

[alan_myers]

<p>I think this is a question you should pose to a good tax accountant, not to unknown folks (like me) on the Internet. This is something you really, really want to get right!</p>

<p>I would guess, but only guess - as a photographer and not a tax accountant - that if one had never sold any photos at all, the IRS might classify them as a hobbyist and might put minimum value on the images, and might base it on cost of materials (processing/printing, matting/framing) only, perhaps. I would think, too, that it would need to be a verified charity.</p>

<p>On the other hand, if one were a working photographer who had made many image sales over the years and who was reporting income from their work, they might consider one's "typical" sale price as a basis to calculate the contribution. In this case, it might be possible to deduct as either a charitable donation to a recognized charity, or a business expense as a customer gift or promotional item.</p>

<p>But, again, I'd consult a tax accountant and not assume anything here. The above are merely guesses.</p>

[Jerry_]

<p>You may also keep in mind: if you want "Business" expenses (i.e., the donation or gift as a write-off,) the IRS will want to know how much "Income" you made that you are trying to offset. Be careful in what you do....</p>

<p>Once you have "Income" identified, the IRS may wish you to contribute self-employment taxes and social security taxes on your "Income."</p>

<p> </p>

[Charles_Webster]

<p>Oh yeah, the IRS lets you deduct expenses for an occupation like photography only up to the amount of your income. In other words, you can't deduct more than you make. You aren't allowed to create a paper "loss" on a photography business unless you can prove that you have significant assets at risk. They are on to hobbyists trying to deduct their vacation expenses because they sold one picture from the trip.</p>

<p> </p>

[chris_stern]

<p>Hello,<br>

Am I correct in saying if someone donates a digital file or photo via electronic transfer via email to be used in a photo auction online they are not allowed to take a tax deduction?<br>

If they supply a physical print they are able to deduct the cost of making that print as a tax deduction and not what the fair market value of the actual print? Correct?<br>

Please advise. <br>

chris</p>

[chris_stern]

<p>I duplicated the message above so disregard this message. </p>