BASIC TAX DEDUCTION INFO
Tax deductions & 170 (E)(3) at a glance
Passed by Congress in 1976, Title 26 of the US Tax Code, Section 170(e)(3) encourages corporations to donate any excess inventory to qualifying non-profits and organizations as an alternative to liquidating their products. In exchange to this, the non-profit may qualify for an enhanced tax deduction.
In order to qualify for this deduction, a corporation must make a qualified contribution as described in Sec. 1.170-4A of the code.
The deduction, as defined in 170(e)(3)(B), is equal to the cost of the individual item plus half of the difference between the cost and the fair market retail value of the item, not to exceed twice the cost.
In other words, you can receive a tax deduction worth up to twice the cost of your donation. For regular C corporations, your deduction is equal to the cost of the inventory donated, plus half the difference between the cost and the fair market-selling price, not to exceed twice the cost. Please consult with your accountant for tax advice.
In order to qualify for this deduction, a corporation must make a qualified contribution as described in Sec. 1.170-4A of the code.
The deduction, as defined in 170(e)(3)(B), is equal to the cost of the individual item plus half of the difference between the cost and the fair market retail value of the item, not to exceed twice the cost.
In other words, you can receive a tax deduction worth up to twice the cost of your donation. For regular C corporations, your deduction is equal to the cost of the inventory donated, plus half the difference between the cost and the fair market-selling price, not to exceed twice the cost. Please consult with your accountant for tax advice.
Cost of Donated Item
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Cost = $10 Selling price = $30 Half the difference = $10 Deduction = $20
Agape Inventory Donation (A.I.D.) protects your reputable name
We’re proud to partner with thousands of nonprofit organizations working to improve the lives of people in need. We screen all potential partners to make sure they have met qualification standards that enable us to properly ensure that all donations are accepted and used in accordance to all of the agreements we have with our non-profits and corporate donors. All of the organizations accepted into the AID nonprofit network must provide the following materials:
Any other needed or required information may be requested on a need-by-need basis, including but not limited to, letters of reference from local community leaders, detailed programmatic information, and additional information about the organization's staff.
For certain products, we request additional information from the nonprofit to ensure that they meet any and all special restrictions requested by the prospective donor.
- Valid proof of their nonprofit status;
- Financial documentation that is both transparent and demonstrates how their respective programs are funded;
- An overview of their mission and/or vision and how they purpose themselves to fulfill it;
- Proof that they meet all required anti-terrorism laws outlined under the Patriot Act; and
- A signed agreement that demonstrates they understand AID's Product Use Guidelines and have agreed to them.
- In some cases, non-501(c)(3) organizations, such as schools and others, are still allowed to participate. They must adhere to all restrictions and agree to additional screening.
Any other needed or required information may be requested on a need-by-need basis, including but not limited to, letters of reference from local community leaders, detailed programmatic information, and additional information about the organization's staff.
For certain products, we request additional information from the nonprofit to ensure that they meet any and all special restrictions requested by the prospective donor.
OUR DONATION NETWORK
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