Any IRS/Sebenza experts on here?

M

MikeH

Joined
Oct 18, 2001
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There is a very talented young guy in our church who writes and directs a Dinner Theater/Murder Mystery every year as a fund raiser for the youth groups. This year he
has arranged for a characterture artist to attend and do drawings of the attendees. In lieu of pay the artist has expresed interest in trading his services for a premium knife from my collection, and I have offered the church a large classic Sebenza MM in unused condition, which I bought at a gun show several years ago. My question is, how do I value this knife as a donation come tax time next year? Original list price? Current resale value? What I actually paid for it? Other?

With nothing else to go on, it seems that my actual purchase price, which is significantly lower than either of the other two possibilities, would be the honest thing to do. However, if there is an IRS acceptable answer that results in a higher deduction, I am not averse to doing that, also, the key word being acceptable. I'm not about commiting fraud here.

Admittedly this is not a lot of money at stake either way, but at the same time if I can legally minimize my taxes I will do it.
 
If you contribute property to a qualified organization, the amount of your charitable contribution is generally the fair market value of the property at the time of the contribution.
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from Pub 526

edit and more from 526 that should verify this is the case:

Capital assets. Capital assets include most items of property that you own and use for personal purposes or investment. Examples of capital assets are stocks, bonds, jewelry, coin or stamp collections, and cars or furniture used for personal purposes.

[...]

Amount of deduction – general rule. When figuring your deduction for a gift of capital gain property, you generally can use the fair market value of the gift.
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Fair Market Value is defined by the IRS in their publications, but is basically what a willing buyer would pay a willing seller, each having knowledge of the relevant facts, and neither being under duress to buy or sell. Also, if the deduction is over $500, I believe you will need an appraisal by a "qualified appraiser." I am a qualified appraiser for real property by virtue of my state license and years of experience and education but I don't know who would meet the qualifications to appraise a knife. Probably won't meet that $500 threshold, though.
 
kreole said:
from Pub 526

edit and more from 526 that should verify this is the case:
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Hey Mike,
I would go with what kreole found. Many things go up in value, and the current fair market value is what you should right off, IMO.
 
You could sell the classic, buy a new model, donate it and you will have a 2012 receipt to show value of donation.
 
stjames said:
You could sell the classic, buy a new model, donate it and you will have a 2012 receipt to show value of donation.
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This. Not sure how you could possibly consider giving up a classic though, especially the large. They are by far the best CRK to me. I would trade in two 21's for a classic any day.
 
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