My wife and I would like to donate our time and effort to our church to design, implement, and setup hosting for a church website. We do websites for paying customers as well through our business entity but this year (2007) we will not be conducting as a business.

Is this something we can personally deduct from our taxes and if so is there any special documentation needed to go along with this? Would we work up an invoice and have the church sign it and then have something official as a donation receipt?

We estimate the work to be about $1000.

Thanks any and all help is greatly appreciated.

Doug

Please wait for a knowledgeable expert to ring in, as I am not, and we have some great resources here concerning taxes, but I can tell you that my cpa told me that in 2007 all charitable donations must be clearly documented. I'm not sure what the change is from before... I know above a certain monetary level documentation was asked about, but he made it sound like any and all tax deductions tied to charity must be now well documented. So if it is elegible you might need to know what documentation is considered adequate.

OK. Now we'll both wait for the real answer to your question.

Sorry, your time and effort CANNOT be deducted.

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Originally Posted by AtlantaTaxExpert

Sorry, your time and effort CANNOT be deducted.

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Can any materials or yearly hosting fees be deducted? I am a little confused. How come a $1000.00 donation is deductible that they use to pay for a website?

Also does it matter that it's a church? What if it's a non-profit school?

Thanks

Doug

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Originally Posted by AtlantaTaxExpert

Sorry, your time and effort CANNOT be deducted.

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I really hate to disagree with you, but I'm not so sure about this. If a consultant usually gets a specified fee for services, then donates those services, I thought they could claim a deduction for it.

I looked into this when I ran a non-profit organization. What Atlanta says here is true. Non gratis labor may be a gift but its not recognised as a deduction. If it were, we'd see tons more pro bono legal work or free medical help out there, me thinks. :rolleyes: LOL

Here is what I found in my files at quick glance from Humanitarian Resource Institute ---

IN-KIND GIFTS & PRO BONO SERVICES

In addition to cash contributions, some companies donate their products to charity-often referred to as "in-kind" gifts-or offer their services on a free "pro bono" basis. Many companies have products that can be used by nonprofits, including products from current inventory, obsolete merchandise, returned or slightly damaged goods, computers, or office furniture and equipment. Nonprofits can also benefit from services provided by a company or its employees, such as printing, legal representation or publication design.

A company's charitable donation of its products can qualify for a charitable deduction. However, limitations exist on what and how much can be deducted. The rules are complicated and require careful prior analysis by corporate or outside counsel.

The value of staff time donated to a nonprofit organization is not deductible, although out-of-pocket expenses (gas, mileage, meals, etc.) for such volunteer work can be deducted within certain limits.

OK, I better hope I don't get audited then ;)

In all the years I did volunteer teaching for the American Red Cross, I was never allowed any deduction - not for travel, not for supplies, not for time. Now if I donated cash and got a receipt, yes. I worked as a volunteer consultant for a non profit for two years and was not allowed any deductions. Hopefully the law has changed.

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Originally Posted by shygrneyzs

In all the years I did volunteer teaching for the American Red Cross, I was never allowed any deduction - not for travel, not for supplies, not for time. Now if I donated cash money and got a receipt, yes. I worked as a volunteer consultant for a non profit for two years and was not allowed any deductions. Hopefully the law has changed.

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I understood volunteers can be paid mileage for work-related travel but its at some laughable rate like $.18/mile (don't quote me on the actual figure) when the usual rate is much higher. And work-related supplies with a receipt can be deducted too, I thought, but its really safer to turn them in for simple reimbursement. But time? Nope. I guess they figure that if you have the financial resources to be giving your time away for free, then you don't need a tax break for it?

While you cannot deduct for time and services, you CAN deduct for out-of-pocket costs (including mileage) incurred while doing volunteer work for a qualified charitable organization.

You just have to be able to prove the costs were in fact incurred while doing the volunteer work.

Thanks by the way for the information. You know it is a damn shame that the laws are the way they are or this great giving nation of ours could give a whole lot more. We are still going to donate our services but what a better place this would be if it would be encouraged by our government.

Imagine... this may be an answer to provide those without health insurance the ability to get decent health care.

Real quick... if mileage etc can be dedcuted can our donation of web hosting and domain registration (this is a physical purchaseable thing not time ) be deducted.

Thanks again

Yes, the actual cost of the web hosting and domain registration CAN be deducted if you can show a separate purchase receipt.