OT: Bikes/Fire

[John Murphy]

I doubt there are any tax attorneys out there... but maybe someone knows
someone...

I'm reading a lot of stories of garages full of bikes turning into ashes
with puddles of aluminum.

A lot of us with garages full of bikes are taking stock and thinking
"you know, I never ride that Allez but it's a pretty decent bike" and
thinking we should pass them on.

If I bring a palette of peanut butter to the food bank, I deduct it. I
wonder if there is a way we could use an organization to pass through
bike donations to fire victims and get the bikes to people who could
really appreciate them, and simultaneously pick Donald Trump's pocket
(seriously, I'm just using "Donald Trump" as a metaphor for the Federal
Government). For a lot of us a bike donation might return almost as much
in write off as we'd get spending weeks haggling to sell a bike.

More important than various people who lost $30k of carbon fiber racing
machines are 12/16/20/24 inch bikes for kids.

It sucks - a lot of these stories start with "I just finished building
up this 70's era Motobecane and was going to take it out on it's maiden
voyage..."

Might even include things like Jerseys.. these folks are starting over.

John

[David Goldsmith]

Yeah, I'm married to a CPA with a tax practice. I'll run it by him.

But on first thought, seems to me you'd need to find a 501c3 non-profit
that would be willing to accept donations and then distribute the bikes
to people who have had losses.

Sounds like a great outreach for SRCC, much more helpful than "thoughts
and prayers."

David

[John Murphy]

SCBC :)

[David Goldsmith]

Confirmed with Chris that I was correct - you need to get a 501c3 to
serve as a clearinghouse, Murph.

David

[jos...@jhaut.com]

I am not a tax attorney but I do have some familiarity with the requirements for charitable gifts. Gifts to a qualified charity (e.g. a 501(c)3 organization) typically entitle the donor to take a deduction. For gifts of personal property, the value of the gift & the resulting deduction is typically the lesser of the fair market value of the property at the time of the gift, or the donor's cost basis (i.e. original purchase price). For most bike gear, the lessor value will probably be the fair market value.

Depending on the value of the gift claimed on your tax return, the IRS will require increasing levels of documentation from you:
- Under $500 you will simply need a gift receipt from the charity
- Over $500 you will need a gift receipt and you will need to file Form 8283 "Noncash charitable contributions" with your tax return. The charity that received the gift will need to sign the Form 8283. Charities are familiar with this form and it should be easy enough to obtain the charity's signature.
- Over $5,000 you will need to obtain a qualified appraisal to support the deduction. The appraiser will need to sign form 8283 in addition to the charity. The appraiser must be a 3rd party who is independent from the gift. Neither you nor the charity can be the appraiser.

The $5,000 threshold is for gifts of similar property, so even if you gifted four $1,500 bikes to four separate charities, you would need to have qualified appraisals of each bike to substaniate the total deduction of $6,000.

The upshot is that it should be pretty straightforward to make a gift of less than $5,000 and claim a deduction. If you gift more than $5,000 worth of bike gear in one year, you will need to find someone to appraise the gear which may be difficult and expensive.

[Patrick Kitto]

I would guess a bike shop might take a 15 minutes to appraise a bike for donation.

All shops are used to writing up appraisals for insurance claims. This would be that different.

And I bet the IRS would take a bike shop estimate as pretty legit.

As always, when you ask a mechanic for a favor, show up with beer. or coffee.

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[Peter Colijn]

I actually had trouble getting shops to appraise my bike for current value. My experience was that most shops are used to doing appraisals for replacement value (for insurance), but are not used to appraising current ("if you sold this on ebay") value.

[Patrick Kitto]

for these purposes, isnt replacement value sufficient? It's not like anyone depreciates a bike as an asset. 

Although that makes me think, maybe we should be depreciating our bikes each year and taking the loss.

[Peter Chang]

Le vendredi 13 octobre 2017 14:30:24 UTC-7, Patrick Kitto a écrit :

Although that makes me think, maybe we should be depreciating our bikes each year and taking the loss.

it's almost possible as a business expense if you work for yourself.

\p 

[jos...@jhaut.com]

The IRS is looking for the amount that you would have gotten if you sold the donated bike. If the bike wasn't brand new, the IRS would probably expect the value of the donation to be lower than the bike's replacement cost. There is a detailed list of requirements of what must be contained in the appraisal and what qualifications the appraiser must have. The details are in IRS publication 561 if anyone is interested.

Most folks probably won't have donations in excess of $5,000, so the appraisal won't be an issue.

[Elliot Schwartz]

Possibly http://www.sfyellowbike.org/ or http://bikekitchen.org/ could point you in the right direction...

John

[Bret Lobree]

A friend just donated to yellow bike. Sounds like they are the most likely to take whole bikes. 

Bret

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