In some cases, donating your boat may be the right direction depending on the market and condition or age of the boat. There are many tax benefits in donating a vessel.
The IRS provides a couple of publications to help understand the process of donating property. Publication #526, Charitable Contributions and Publication #561, Determining the Value of Donated Property. In most cases, you may deduct an amount up to 50% of your adjusted gross income. If your contribution exceeds 50% of your gross income, you may deduct the excess in the five succeeding years until its used. It’s a great tax deduction!
The value of your boat must be determined prior to donating by an expert boat appraiser or marine surveyor. You may gradually deduct the fair market value at the time of the contribution.
Other benefits besides the tax right off is the expense of keeping your boat, as you well know when it’s not selling. From slip or mooring fees, insurance, maintenance, required repairs, etc. it’s costly plus, the commission fees to the yacht broker all add up and in some cases, it makes more sense to to donate the boat.
Many charities or organizations can really benefit from boat donations. It’s a win-win. You get a great tax right off and individuals who normally could not experience our wonderful boating lifestyle, get the opportunity.
Please connect with us for further details and to get a valuation on your vessel.