We have partnered with the iDonate Foundation to handle your online noncash donations to IRT. iDonate handles the entire process, from the transfer to the sale, and turns your noncash donation into proceeds for IRT programs!
To donate marketable securities (stock/bonds/mutual funds, etc.) or real estate valued under $50,000 please call the IRT office directly at 619-284-7979.
When you make a donation on our website, iDonate will contact you by email or phone, depending on the donation. Although every donation scenario is unique, iDonate will make your donation experience simple for you. iDonate Foundation provides the appropriate donation receipts to you, the donor. Once the donated item is sold, the proceeds are processed and a check is sent to IRT.
See below for a list of guidelines of what can and cannot be accepted:
Always accepted
Accepted on case-by- case basis
Not accepted
(including pornographic or illegal items)
How quickly can my vehicle be picked up (and do I need to be there when it is)?
A: Typically, your vehicle will be picked up within three business days. However, often your pickup is even faster. In most cases, you do not need to be present when your vehicle is picked up.
How much is my vehicle worth?
A: Most vehicles are sold through well-advertised auction services (iDonate handle all of this, so you don’t have to worry about it). The value of the vehicle is the highest price offered by buyers—this process maximizes the value of your donation.
How much can I deduct for a vehicle?
A: It’s always best to consult a tax adviser for your specific situation as tax laws change frequently. Generally, for vehicle and boat donations, you can deduct the item’s gross selling amount.
Donating your valuables to IRT means a reduction in your tax burden! You noncash items such as cars, boats, RVs, marketable securities, jewelry, real estate, business interests, gifts cards, grains, etc. can decrease your tax liability and save lives for victims of disaster and poverty in forgotten corners of the world. Read the Q and A below for common questions and examples of tax breaks you can expect for certain items.
Q: How much can I deduct for real estate and business interests?
iDonate and IRT strongly recommend that a tax adviser be consulted for your specific situation as tax laws change frequently and iDonate and IRT do not give tax or legal advice. For real estate and business interest donations, you can usually deduct the fair market value (FMV) of the gift at the time of transfer up to 30% of your adjusted gross income. The FMV is determined by a qualified appraisal which must be performed no earlier than 60 days before the gift. Appraisal guidelines can be found in IRS Publication 561.
Q: How much can I deduct for marketable securities (stocks, bonds, mutual funds, etc.)?
IRT strongly recommends that a tax adviser be consulted for your specific situation as tax laws change frequently and IRT does not give tax or legal advice. For marketable security donations, you can usually deduct the fair market value of the gift at the time of transfer. Please remember to call IRT directly at 619-284- 7979 for donations of marketable securities (stocks, bonds, mutual funds, etc.).
Q: What are the benefits of donating marketable securities (stocks, bonds, mutual funds, etc.)?
Appreciated marketable security donations generally receive two key benefits: 1) a current-year tax deduction for the fair market value and 2) no capital gains taxes paid on the sale. Please consult with your tax adviser for information on how these benefits apply to your situation.
Q: What are the benefits of donating real estate?
iDonate makes it easy for you to help IRT by handling your donation of real estate valued over $50,000. iDonate assists with the transfer paperwork and coordinates the sale, forwarding proceeds to IRT. Appreciated real estate donations generally receive two key benefits: 1) a current-year tax deduction for the full fair market value of the property and 2) no capital gains taxes paid on the sale of the property. Please consult with your tax adviser for information on how these benefits apply to your situation. Please remember to call IRT directly at 619-284-7979 for donations of real estate valued under $50,000.
Q: What if I don’t know the exact information to complete the online real estate illustration?
The online gift experience prepares a personalized illustration of the benefits from giving your real estate. If you don’t know your exact information, that’s okay. This is for illustration purposes only.
Q: What types of real estate valued over $50,000 will iDonate accept?
iDonate will generally accept real estate if all of the following are true: 1) Fair market value is over $50,000. 2) There are no environmental issues. 3) There is no debt on the property. 4) There is a good probability that the property can either be sold within six months or that the property will generate significant income for your cause while we hold it.
Q: What types of real estate valued under $50,000 will IRT accept?
IRT determines real estate donations under $50,000 on a case-by- case basis.
Q: What is the pre-acceptance process for real estate over $50,000 for iDonate?
iDonate may request an ownership and encumbrance report (O&E) and/or title insurance at your expense. For farmland, commercial property, or property with known environmental risks, we may also request a Phase I report at your expense. iDonate will consult with a real estate agent in the area to determine the marketability of the property.
Q: What costs am I responsible for when I donate real estate over $50,000?
If there is not a potential buyer, iDonate may ask that you make an additional tax-deductible cash contribution at the time of the gift to cover one year’s worth of insurance, property taxes, utilities, and other costs of ownership.
Q: What costs am I responsible for when I donate real estate under $50,000?
Please call the IRT office at 619-284-7979 to discuss further.
Q: What is the real estate valued over $50,000 donation process with iDonate?
After iDonate receive your information, they will contact you to discuss your offer as well as any documentation needed to accept your donation. They will research the property to determine whether the gift makes sense for you and IRT, and the board will determine whether the gift can be accepted. You will generally need to obtain an appraisal and have the appraiser sign IRS Form 8283. iDonate will prepare a deed to be signed and notarized; then they will file it with the appropriate county. After the property has been transferred, you will receive a gift-in-kind receipt. After the property has been sold, iDonate will give proceeds to IRT.
Q: Does iDonate always sell the real property gifts it receives immediately?
iDonate generally tries to sell gifts of real property within six months ("Give & Sell"). If your property generates significant ongoing income, however, it might make sense for IRT to hold the property while it creates revenue for them ("Give & Hold").
Q: What are the benefits of donating business interests?
iDonate makes it easy to help IRT by donating business interest. They assist with the transfer paperwork and forward proceeds to IRT. Appreciated business interest donations generally receive two key benefits: 1) a current-year tax deduction for the fair market value and 2) reduced capital gains taxes paid on the sale. Please consult with your tax advisor for information on how these benefits apply to your situation.
Q: What if I don’t know the exact information to complete the online business interest illustration?
The online gift experience prepares a personalized illustration of the benefits from giving your business interest. If you don’t know your exact information, that’s okay. This is for illustration purposes only.
Q: What is the business interest donation process?
iDonate will request that you provide initial information and basic documents about the business to help them begin assessing your proposed gift. They will prepare a gift proposal that will explain and illustrate your proposed gift and what the expected tax results and IRT proceeds will be. Both parties will sign a gift agreement that describes the terms of the gift. iDonate strongly encourages you to involve your professional advisors in the process; any information provided by iDonate should not be construed to be professional advice.
Q: Does iDonate always sell the business interest gifts it receives immediately?
Business interest gifts are often liquidated as soon as possible after the transfer ("Give & Sell"). However, many business owners choose to maintain management oversight of their business while giving a non-voting interest (“Give & Hold”). In this way your business can create ongoing revenue for IRT.
For donors who actively engage in farming on a cash basis[1], significant tax savings may be achieved by donating grain directly to IRT. The tax savings of gifting grain becomes very apparent when compared to selling the grain and donating cash.
EXCLUSION FROM INCOME. Cash gifts to IRT are deductible if a donor itemizes deductions on Schedule A. Many farmers, however, take the standard deduction.[2] As many farmers take the standard deduction, no tax benefit is gained by making charitable gifts of cash. By directly donating grain to charity, however, the cash basis farmer can exclude the sale of the grain from income, which can result in a triple tax savings.
The tax savings can include:
EXPENSES RELATED TO PRODUCTION. For most farm operators, the expenses related to the production of the donated grain are deductible on Schedule F.[3] The donation of grain reduces the income that is reportable on Schedule F.
NO CHARITABLE CONTRIBUTION DEDUCTION. Donors of grain should not report the donation on Schedule A. There is no additional deduction allowed since the tax benefit comes from the deduction of production expenses and not reporting a sale on Schedule F.
TIMING OF GIFT. Another great benefit of donating grain is the fact that it doesn’t matter if the donation is made in the year of production or a later year. Gifts of grain can be donated from the current or previous years’ harvests.
FEWER FORMS. Yet another great benefit of donating grain: fewer forms! Generally speaking, if the total of your donated property is more than $500, you have to file an additional form with your return, Form 8283: Noncash Charitable Contributions. For property valued at more than $5,000, generally, you have to produce a qualified appraisal by a qualified appraiser.
However, with gifts of grain, as mentioned above, there is no charitable deduction taken. Therefore, the donor of grain doesn’t need to provide Form 8283 or a qualified appraisal. So, gifts of grain can be said to be easier gifts than other types of property.
Keep in mind the tax benefits of gifting grain don’t apply to everyone. As discussed more fully below, crop share landlords won’t be eligible, and only cash basis farmers will be able to reap these benefits.
CROP SHARE LANDLORDS NOT ELIGIBLE. There are of course two major kinds of farm leases: cash share leases and crop share leases (there are also hybrids of the two).[4] A crop share landlord would not be eligible to receive the tax benefits discussed here. A crop share landlord’s share of crops is considered rental income and must be reported as such on the landlord’s tax return.
CASH BASIS FARMER ONLY. As mentioned at the very outset of this article, to receive the tax benefits discussed in this article, the farmer must be a cash basis taxpayer. See first endnote.
A few cautionary notes regarding prior sale commitments; physical delivery; giving up control; and storage, transportation, and risk.
NO PRIOR SALE COMMITMENT. To receive the tax benefits discussed in this article, the farmer cannot sell the grain and then order the sales proceeds to be sent to IRT. The gift must be from unsold grain inventory with no prior sale commitment.
PHYSICAL DELIVERY. This is similar to the point made directly above regarding no prior sale commitment. The commodity should be put into IRT’s name when it is delivered to the elevator and a warehouse receipt should be issued in IRT’s name. For grain stored on the farm, the farmer should deliver to IRT a notarized letter of transfer.
GIVING UP CONTROL. Another similar point. The farmer must give up dominion and control over the grain and cannot offer any guidance as to when to sell the grain. IRT must direct the sale and the original sales invoice must list IRT as the seller.
STORAGE, TRANSPORTATION, AND RISK. After the transfer, iDonate assumes the full costs of storage, transportation, and marketing, and bears completely the risk of any loss.
USE PROFESSIONAL ADVISORS. Donors should always consult with their professional tax and/or legal advisors to determine tax implications specific to their situation prior to making the gift.
CASE STUDY OF TAX SAVINGS FROM A GIFT OF GRAIN
Melissa, a cash-basis grain farmer who takes the standard deduction every year, donates 1,000 bushels of corn to her favorite charity, a local hospital. Her cost of production is $2,000, and the proceeds from the sale of the corn by the hospital is $5,000.
Melissa is entitled to deduct her $2,000 of production expenses on Schedule F. In addition, she will not be required to report the proceeds from the sale of the corn as income. Assuming that Melissa is in the 25% federal and 8.98% Iowa tax bracket, the following are the tax savings thatresult when Melissa reduces her taxable income by making a gift of the corn to a charity:
$1,250 Federal income tax ($5,000 x 25%)
$ 449 State income tax ($5,000 x 8.98%)
$ 765 Self-employment tax ($5,000 x 15.3%)
$2,464 Tax savings
By donating the corn rather than selling it outright and making a cash gift, Melissa saves $2,464 in taxes. In addition, she can still deduct the $2,000 of production expenses she incurred to grow the corn.
(Note: If Melissa itemizes her deductions rather than claiming the standard deduction, her additional tax savings through making a gift of corn rather than cash would be limited to the savings on self-employment tax.)
[1] There are, of course, several methods of accounting for income. Farmers have been given an advantage in the Internal Revenue Code by being allowed to use the cash method of accounting. Most farmers choose the cash method because of the tax advantages. The cash method of accounting allows (many) farmers to claim the expenses of the current year’s crops while postponing the recognition of income. Under the cash method, all income is included in the year it is actually or constructively received. Farm business expenses are deductible in the year in which they are paid.
[2] You can either claim the standard deduction or itemize your deductions — whichever lowers your tax the most. The standard deduction is a fixed dollar amount that reduces the income you’re taxed on. Your standard deduction varies according to your filing status. Three noteworthy items about the standard deduction. First, it allows you a deduction even if you have no expenses that qualify for claiming itemized deductions. Second, it eliminates the need to itemize deductions, like medical expenses and charitable donations. Third, the standard deduction allows you to avoid keeping records and receipts of your expenses.
The benefit of itemizing is that it allows you to claim a larger deduction that the standard deduction. However, it requires you to complete a Schedule A attachment to your return and to maintain records of all your expenses.
Itemized deductions include a range of expenses that are not otherwise deductible. Common expenses include the mortgage interest you pay on up to two homes, your state and local income or sales taxes, property taxes, medical and dental expenses that exceed 7.5 percent of your adjusted gross income, and the charitable donations you make. Itemized deductions also include miscellaneous deductions such as work-related travel and union dues. Once you decide to itemize, you are eligible to claim all of them.
[3] If you earn a living as a self-employed farmer, you most probably need to include a Schedule F attachment with your tax return to report your profit or loss for the year. The Internal Revenue Service defines “farmer” in a very broad sense—whether you grow crops, raise livestock, or even breed fish.
In addition to the money you earn from selling crops and livestock, Schedule F also reports other types of farming income, such as any crop insurance payouts, including: federal disaster payments; money you earn through a farming cooperative; payments you get from an agricultural program.
You can deduct any cost you incur that’s an ordinary and necessary expense of farming on Schedule F to reduce the profit — or increase the loss — on which you’ll owe taxes. Some ofthe expenses that farmers commonly deduct cover the cost of livestock and feed, seeds, fertilizer, wages paid to employees, interest paid during the year on farm-related loans, depreciation to recover a portion of equipment costs, utilities and insurance premiums.
[4] In a cash rent lease, generally, the tenant usually pays a fixed dollar amount in rent (either on a per acre or whole farm basis). These types of leases may be modified depending on crop yield (i.e., increase in good years and decrease in bad years). With cash rent leases, the landlord is not as involved in crop production, thereby giving the tenant more autonomy.
In a typical crop share lease, the landlord will share input costs (including but not limited to seed, fertilizer, and fuel), while the tenant provides all of the labor and remaining input costs. Once harvested, proceeds will be divided according to the agreement (which may range from, say, 25/75 to 50/50). With crop share leases, most often both parties share the risks.
