I have the opportunity to buy the overstock, through a liquidation distributor,
from a manufacturer of name brand sweaters. I can buy 1000 beautiful
purple long sleeve turtle neck sweaters, brand new, for $1750, a one
time deal (up to about 1300 sweaters, after which there are no more).
They retailed for $30.
According to the paperwork my CPA gave me, one such sweater donated,
in excellent condition, is permitted valuation at $20. That would mean
1000 would be a $20,000, which is what another gentleman I met did by
his CPA's instruction when he bought 10,000 pair of pants on a distress/liquidation
sale for his son who sells at flea markets, but then his son didn't want
them.
Roger addressed most of my questions, but...a donation valued over $5000
must be accompanied by a qualified appraisal for this specific purpose,
and if you can believe it, I couldn't find an appraiser in Grand Rapids
who was qualified to evaluate sweaters! I had planned to use purchases
of merchandise at distress sales to raise money for the development of
a Christian university in Haiti to invest in the professional and business
infrastructure there. The idea was to donate the items to my favorite
charities, and then use the tax money saved to send to this project in
Haiti.
Thanks
Sarah
All right, Sarah,
This intrigues me.
So, do you know what I would be apt to do?
I would get some local organization involved. Put out press releases....inviter
reporters...' and auction off the sweaters this way. Each buyer buys two.
They keep one - and they donate the other back to the local charity to give
to a woman who could use it.
1) You'll be able to get a specific total for the value of the sweaters (i.e.
the amount you raised).
2) You'll be able to get the charity a lot more money than if you just donate
the sweaters.
3) You'll be able to get the charity a lot more visibility.
4) Some women will still be getting sweaters...others may be getting money
to help with the cold. Or something.
5) Your contribution deduction is defined and protected, because you can get
the local charity to confirm the amount raised.
6) You can still use the tax money you saved for your offshore charity - the
university in Haiti.
In fact, if your Christian university is run through a US organization, you
might even be able to get another charitable deduction for the money you donate
to them.
You could really make those sweaters go a long way.
How's that for an idea....?
Best wishes,
Eva Rosenberg, MBA, EA
