Charity Auction Gone Wrong


A

Anonymous User

In late 2012 I bid on a service at a charity auction and won it. In early 2013 I attempted to use the service, but the provider said there were only two days on which I could use the service so I said maybe later in the year or next year. This month (now 2014) I tried to use the service again only to be told by the provider that he is no longer able to provide the service plus it had expired in 2013 anyways. Flaky person.

So, I figure I'd just write it off as a tax deduction to the charity. In what tax year can I do it and what sort of documentation do I need?
 
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A

Alan

In late 2012 I bid on a service at a charity auction and won it. In early 2013 I attempted to use the service, but the provider said there were only two days on which I could use the service so I said maybe later in the year or next year. This month (now 2014) I tried to use the service again only to be told by the provider that he is no longer able to provide the service plus it had expired in 2013 anyways. Flaky person.

So, I figure I'd just write it off as a tax deduction to the charity. In what tax year can I do it and what sort of documentation do I need?
You are allowed a charitable contribution deduction for the difference
between what you paid for the item being auctioned (tangible or not
tangible) and its fair market value (FMV). If you pay less than or equal
to FMV there is no deduction. Typically, the charity provides estimates
of the FMV either in a catalog or next do the item being auctioned. In
silent auctions, the estimate of FMV is usually posted on the table next
to the item that is bid on. If you win an item that had no estimate of
FMV provided by the charity, you could still obtain the deduction if you
can substantiate that at the time of the bid you had a fairly good idea
of the FMV. You take the deduction (difference between FMV and your bid)
in the tax year that you paid the money to the charity.

The fact that you were unable to obtain the service you purchased has no
effect on your deduction. Your only recourse is civil suit against the
provider to compel performance or a civil suit against the charity if
you believe you were intentially misled on what you bid on.
 
B

Barry Margolin

Alan said:
You are allowed a charitable contribution deduction for the difference
between what you paid for the item being auctioned (tangible or not
tangible) and its fair market value (FMV). If you pay less than or equal
to FMV there is no deduction. Typically, the charity provides estimates
of the FMV either in a catalog or next do the item being auctioned. In
silent auctions, the estimate of FMV is usually posted on the table next
to the item that is bid on. If you win an item that had no estimate of
FMV provided by the charity, you could still obtain the deduction if you
can substantiate that at the time of the bid you had a fairly good idea
of the FMV. You take the deduction (difference between FMV and your bid)
in the tax year that you paid the money to the charity.

The fact that you were unable to obtain the service you purchased has no
effect on your deduction. Your only recourse is civil suit against the
provider to compel performance or a civil suit against the charity if
you believe you were intentially misled on what you bid on.
He didn't bid on something and not receive it, he donated the car so the
charity could sell it at auction. But they couldn't sell it because
someone stole it from them.
 
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A

Alan

He didn't bid on something and not receive it, he donated the car so the
charity could sell it at auction. But they couldn't sell it because
someone stole it from them.
Barry: Please reread the OP. You have it confused with the other recent
post on the stolen car.
 

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