How to Donate Self Storage Space to 501C3 Nonprofits

By Elizabeth Rayne

Contributions to 501(c)(3) organizations are tax-deductible for individuals and businesses. You can reduce your taxable income and reduce your overall tax bill if you make the right kind of donation to an exempt organization. Donations are deductible only if you itemize deductions are your tax return. If you are interested in donating self storage space, there are a number of steps you should take to find out if your donation is tax-deductible.

Research the Organization

Before making a donation to a charity, you should research the organization to find out if it has 501(c)(3) status. The IRS grants 501(c)(3) status to nonprofit organizations that have a charitable purpose. Once it has this status, the nonprofit may be referred to as an "exempt" organization, meaning it is exempt from income tax, and donations are tax-deductible. Visit the IRS Exempt Organization Select Check page (see Resources), and click on the Search button. From there, limit the search to organizations that are eligible to receive tax-deductible contributions. Submit in as much information as you have about the organization, and check if the nonprofit is on the exempt organization list.

Determine if your Donation is Deductible

Only certain types of donations are deductible. Generally, donations of money or property for the use of an exempt organization are deductible. You cannot deduct a charitable contribution of less than your entire interest in the property. This means that if you are donating storage space for the exempt organization to own outright, the donation is deductible. However, if you will continue to own the storage space, and will simply allow the nonprofit to store supplies or equipment, the donation is not deductible. In other words, you must give up your right to own and use the storage space to the nonprofit to make a deductible contribution.

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Maintain Records

If you plan on deducting your donation, you must maintain a record of the contribution. Request the exempt organization to draft a written acknowledgement of your donation, which must include the date of the donation, a description of the donation, the estimated fair market value, and whether the organization gave you any goods or services in exchange for the contribution. You must have this record by the date your tax return is due.

Report Donation

If your donation meets the requirements for a tax-deductible contribution, you may report the donation if you itemize your deductions on your tax return. To itemize deductions, attach Schedule A to your Form 1040. If the storage space had a fair market value of more than $500, you must fill out and attach Form 8283 to your return.

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How do I Accept Donations on a Pending 501(c)(3)?

References

Resources

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Non Profit Donation Rules

Nonprofits are businesses organized for a purpose other than generating profit. For that reason, the survival of a nonprofit often depends on acquiring donations from the public. These organizations, however, must comply with state and federal laws that place certain restrictions on the solicitation and use of donated funds. Understanding how these rules affect your nonprofit can ensure the continued existence of the organization.

What Is a In-Kind Donation 501C3?

A 501(c)(3), or non-profit, is an IRS approved organization that has a charitable, religious, public safety, or educational purpose. The benefit of qualifying as a nonprofit is that the organization does not have to pay taxes on the money it receives and donors to a 501(c)(3) can deduct the amount of their gifts from their taxable income. As a result, classifying and measuring the amount of donations, such as in-kind donations, can be an incredibly important part of preparing an entity’s tax return.

How to Find 501(C)(3) Tax Exempt Companies

To obtain a 501(c)(3) tax exempt status, most nonprofit companies must file documents with the IRS proving they operate for certain charitable purposes specified by statute. Internal Revenue Code 501(c)(3) includes groups whose purposes are charitable, educational, religious, scientific, literary or supporting national or international amateur sports competitions, the prevention of cruelty to children or animals, and testing that applies to public safety. Contributions to 501(c)(3) organizations, with the exception of those that test for public safety, are deductible as charitable donations for federal income tax purposes. With the help of a number of federal and state government websites, as well as private websites, there are several ways to verify the exempt status of a nonprofit.

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