Wildguzzi.com
General Category => General Discussion => Topic started by: Vince in Milwaukee on October 20, 2017, 11:58:05 AM
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Not sure if this has been covered before, but here goes. I have an old BMW K75 with a bad transmission that I should probably part out, but don't want the associated troubles. If I were to donate it to a charity, I believe I can write it off on my taxes. Problem with that is I would then have to itemize deductions. As it stands now, the standard deduction more than works for me. I'm guessing the value of the K75 (Kelly Blue Book?) just doesn't make this a winning proposition. Thoughts.
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I'd say do the donation and don't do the write-off. It's not really charity if you get money back, and it's not really a donation if it has no actual value.
$0.02
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I doubt that you'll get Kelly Blue Book, which can't be too much for a '93 K75. I'm thinking you'll get scrap value since it's not in useable condition.
On another note -- I was raised in Kenosha, WI a lifetime ago and have a brother who still lives there. The last time my wife and I were there it looked like the city was on an economic up-turn. Good for them.
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most libraries have a MV donation link on their websites
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when you donate a vehicle you only get to write off what ever vehicle sells for , at one time they used to let you write off the kbb price but that has changed.
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What about looking for a local high school that could use it as a shop project? They may have some budget for parts, the kids would do all the labor, then they'd likely sell it to fund the next project.
Or, see if the local BMW dealer or one of their mechanics is interested in it. You may get a few hundred $, they get a project, everyone's happy. And you know they'll have a trailer to pick it up with!
GLWDonation
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I'd say do the donation and don't do the write-off. It's not really charity if you get money back, and it's not really a donation if it has no actual value.
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Aptly Put!
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Not to pick a nit, but I think in this case, the donation would be a tax deduction, not a tax exemption.
Example:
You earned $50,000. If you donated the motorcycle, and it was worth $1000, and you could take the $1000 as a tax exemption, then, you would pay taxes on $49,000.
You earned $50,000. If you could take the $1000 as a tax deduction, your deduction would equal $1000 x whatever tax bracket you fall under. If for example, you fell under a 15% bracket, you could reduce your tax bill by $150.00.
You won't recoup $1000, because the gift is a deduction, not an exemption. A nice gift on your part to a charity, and a reasonable deduction for you.
Any accountants out there that can confirm this?
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Not to pick a nit, but I think in this case, the donation would be a tax deduction, not a tax exemption.
Example:
You earned $50,000. If you donated the motorcycle, and it was worth $1000, and you could take the $1000 as a tax exemption, then, you would pay taxes on $49,000.
You earned $50,000. If you could take the $1000 as a tax deduction, your deduction would equal $1000 x whatever tax bracket you fall under. If for example, you fell under a 15% bracket, you could reduce your tax bill by $150.00.
You won't recoup $1000, because the gift is a deduction, not an exemption. A nice gift on your part to a charity, and a reasonable deduction for you.
Any accountants out there that can confirm this?
I'm a couple of drinks in, but it sounds like you described the same thing twice.
An EXEMPTION (or tax credit) would be if you could reduce the amount of tax you pay by the full $1000.
A DEDUCTION would be if you reduce the income on which to pay taxes buy the $1,000 so you only save your effective tax bracket's worth of the $1k. So in your example $150.
Donating a vehicle or anything to charity is at most a deduction.
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I'd take it to the local BMW owners group and donate it as a raffle prize (or whatever else they want to do with it).
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I'm a couple of drinks in, but it sounds like you described the same thing twice.
An EXEMPTION (or tax credit) would be if you could reduce the amount of tax you pay by the full $1000.
A DEDUCTION would be if you reduce the income on which to pay taxes buy the $1,000 so you only save your effective tax bracket's worth of the $1k. So in your example $150.
Donating a vehicle or anything to charity is at most a deduction.
Kev, if that's not what I said, that's what I meant.
Bob
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Kev, if that's not what I said, that's what I meant.
Bob
I thought that was what you meant, but it looked to me like both examples were actually showing deductions.
For the first example to have been an exemption (tax credit) you would have had to figure out how much tax one would owe with an income of $50k and then reduce THAT tax by $1k.
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I thought that was what you meant, but it looked to me like both examples were actually showing deductions.
For the first example to have been an exemption (tax credit) you would have had to figure out how much tax one would owe with an income of $50k and then reduce THAT tax by $1k.
Got it! Thanks. I was thinking that an exemption allowed the filer to subtract the entire ($1000 in my example) from their gross income. Then calculate their taxes based on that amount. That's why I let Dave the accountant do my taxes! :grin:
Bob
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I have done it. Don't expect more than a couple hundred dollar deduction and you won't be disappointed.
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Got it! Thanks. I was thinking that an exemption allowed the filer to subtract the entire ($1000 in my example) from their gross income. Then calculate their taxes based on that amount. That's why I let Dave the accountant do my taxes! :grin:
Bob
That's a deduction and is basically the same as your second example.
Buy reducing your next income by $1000, you only reduce the rate owed by the % of your effective tax rate. If 15% like the example then your only save $150.
But if you had a $1000 tax credit then regardless of your taxable income you save a full $1000 in taxes.
(Kev <--- not an accountant, but watches mine like a hawk).
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I am donating a 1981 Honda CT 110 to this years local Rotary Auction. They will give me a receipt for the auction sales price. I the will deduct this against my income for the year, not from the taxes owed.
I have done this in the past, it is not a money maker. However the club does good work and supports the local community.
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IIRC you'll need an amount to make it worth doing the long form. Joliet Jim is a tax dude. I've donated a Buick to the National Kidney Foundation and do donations to a couple of local charities.
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Under Trump, the Republican House/Senate may make this taxation for 2017 different retroactively before the end of this year so what you are attempting to do is void tax wise. I would wait 'till December to see if the tax rules change. :azn:
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Under Trump, the Republican House/Senate may make this taxation for 2017 different retroactively before the end of this year so what you are attempting to do is void tax wise. I would wait 'till December to see if the tax rules change. :azn:
According to this article by Business Insider ( http://www.businessinsider.com/trump-tax-plan-details-corporate-rate-individual-brackets-deductions-cuts-2017-9 ) the charitable deductions are one of the only explicitly left in place in the proposed plan.
Granted the plan also includes doubling the standard deduction so itemizing might not make sense for some.
They also seem to believe it's unlikely something will be passed before the year is out. But we'll see.
And shit if this goes through anywhere near how it's proposed I hope the joint income levels are a good bit higher for the 28% and 33% brackets. I have a bad feeling this is going to cost me...
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I'd take it to the local BMW owners group and donate it as a raffle prize (or whatever else they want to do with it).
As a proud K75 owner myself I can say the above is worth next to nothing. However, if you can pick up a K75 bike or working transmission for again, next to nothing, and do a swap, you'll have a bike worth about $1000-1500. Sad for such a nice bike that could still provide many years and miles of service but that is what they are "worth".
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As a proud K75 owner myself I can say the above is worth next to nothing. However, if you can pick up a K75 bike or working transmission for again, next to nothing, and do a swap, you'll have a bike worth about $1000-1500. Sad for such a nice bike that could still provide many years and miles of service but that is what they are "worth".
You've pretty much hit the nail on the head. My biggest problem is finding a good, used transmission. Bob's and ReCycle never seem to have any, and I am gun shy of trusting e bay. Too bad a member on here doesn't have one for sale. A good steady day in the garage would have me riding it again.