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Is video production considered a donation for tax deduction?

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Curt SchulzIs video production considered a donation for tax deduction?
by on Nov 22, 2010 at 8:57:48 pm

I recently created a video for free for a non-profit for a fundraising dinner. I did everything from scripting, to shooting, to editing---a project that I would have charged about $3500 for. Could I consider this a charity donation for a tax deduction?

Some may say that I donated my time (which is not deductible), but I actually donated a finished product, a deliverable, something that would normally be taxable (like a wedding video).

I read that in other cases you need to get an acknowledgment letter from the charity and appraisals for donated property so I'm wondering if anyone else has been in a similar situation or if they think this is viable.

Thanks for your time.

Curt Schulz
MBP 2.53 4GB Ram/Mac OS 10.6.4/FCP7.02/Matrox Mini w Max 2.0.0.0150


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Cory PetkovsekRe: Is video production considered a donation for tax deduction?
by on Nov 23, 2010 at 12:32:38 am

Talk to your tax advisor or CPA. However this guy says no.
http://www.nonprofitissues.com/public/features/point/66.html

--
Cory Petkovsek
Corporate Video


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Steve KownackiRe: Is video production considered a donation for tax deduction?
by on Nov 23, 2010 at 3:06:00 pm

Nope. This is something you do out of the kindness of your heart.

However - don't be bashful about asking for in-kind marketing and PR. Get your story on their website and newsletter. Have you logo put in a printed program; become one of their "sponsors" which usually includes lots of logo/name placement. See where else they can talk you up. When they stick it on YouTube, be sure your name is in the description.

Why not have a screening at their place? They can invite guests, have a big to-do and introduce you.

And don't forget the value of that audience and the participants you may have interviewed. Send a DVD or a link for them to view the video.

That's the ROI you get for freebies.

Steve






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David Roth WeissRe: Is video production considered a donation for tax deduction?
by on Nov 23, 2010 at 6:13:16 pm

A donation of your time, i.e. "in kind services," cannot be used as a deduction. Only cash expenditures and goods qualify.

David Roth Weiss
Director/Editor/Colorist
David Weiss Productions, Inc.
Los Angeles
http://www.drwfilms.com

POST-PRODUCTION WITHOUT THE USUAL INSANITY ™


A forum host of Creative COW's Business & Marketing and Apple Final Cut Pro forums. Formerly host of the Apple Final Cut Basics, Indie Film & Documentary, and Film History & Appreciations forums.


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Steve MartinRe: Is video production considered a donation for tax deduction?
by on Nov 23, 2010 at 7:12:40 pm

Hi Curt,

Obviously check with your CPA, but I would agree with the other posters. Regardless of the value you apply to your product or service, you can't claim it as a charitable contribution - unless you give them the money.

The only "tax benefit" is that you don't have any income to offset any hard expenses you may have incurred for the project - things like any freelance labor you might have hired, blank media or equipment rentals. Small consolation but it's something.

But as others have pointed out, the real value to you as a producer is in the audience at the event. If you think it's appropriate for the event, perhaps ask the charity to provide a heart felt thanks from the stage at the event to you and your company. That coupled with an ad in the program could be very valuable to you. Given that the folks who attend these fundraisers are often business leaders & movers and shakers in the community, that might lead to huge dividend for you.

You might even do a little research to find out who is on the charity's board of directors. These are often power brokers and if any of them are good prospects, ask the organization to make an introduction for you.

Good luck!

Production is fun - but lets not forget: Nobody ever died on the video table!


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Mark SuszkoRe: Is video production considered a donation for tax deduction?
by on Nov 24, 2010 at 1:57:29 am

If you did this for a political candidate or organization, it might be considered an "in-kind contribution".


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Craig SeemanRe: Is video production considered a donation for tax deduction?
by on Nov 26, 2010 at 8:07:36 pm

Yes, it's my understanding that if you provide a professional service below "market value" (what you'd normally charge) the difference is an in kind contribution to the political campaign . . . which of course is not tax deductible.



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Curt SchulzRe: Is video production considered a donation for tax deduction?
by on Nov 24, 2010 at 2:59:30 am

Thanks to everyone who responded---I figured as much, but I had to ask;) I try to do one charitable video a year and recommend it to anyone in this business as a great way to give back and "pay it forward". I'd much rather donate my time in a meaningful way than write a check.

Cheers,
Curt

Curt Schulz
MBP 2.53 4GB Ram/Mac OS 10.6.4/FCP7.02/Matrox Mini w Max 2.0.0.0150


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Scott CarnegieRe: Is video production considered a donation for tax deduction?
by on Nov 24, 2010 at 5:56:46 pm

You can do what is called a "check swap".

Make a deal with the NPO that you will do Project A for X dollars and then you will donate the money right back to them and get a charitable donation receipt.

http://www.MediaCircus.TV
Media Production Services
Winnipeg, Manitoba, Canada


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Steve KownackiRe: Is video production considered a donation for tax deduction?
by on Nov 24, 2010 at 6:05:21 pm

All in all it nets you zero. You'll show the income then a contribution. IMO not worth the paperwork.

Steve






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Steve BoultbeeRe: Is video production considered a donation for tax deduction?
by on Nov 29, 2010 at 8:26:48 pm

Provided that this non-profit is a 501(c)(3) organization (any other non-profit will never qualify for charitable deductions), you would be able deduct the lesser of your basis in the property (i.e. your actual costs of production) or the fair market value as a charitable contribution. In your case, the lesser of the two will be the actual production costs.

Now,given that your costs of production are deductible as ordinary business expenses anyway, there's nothing left to deduct as a charitable contribution.


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