RosieCotton Posted September 4, 2013 Share Posted September 4, 2013 Would I need to incorporate my homeschool as a non-profit to grant tax deductions for donations to my homeschool? I have a number of wealthy business owners who are friends of ours that when they give to us for school I'd like to repay the kindness. I think you can "gift" up to 500.00 to anyone and use that on your tax returns. So maybe I wouldn't have to incorporate? (probably 350.00 when complete . . )) Any tax accountants online lol? Quote Link to comment Share on other sites More sharing options...
regentrude Posted September 4, 2013 Share Posted September 4, 2013 Would I need to incorporate my homeschool as a non-profit to grant tax deductions for donations to my homeschool? I have a number of wealthy business owners who are friends of ours that when they give to us for school I'd like to repay the kindness. I think you can "gift" up to 500.00 to anyone and use that on your tax returns. So maybe I wouldn't have to incorporate? (probably 350.00 when complete . . )) Any tax accountants online lol? You can't just "gift" anybody $500 and deduct it from your tax. You can donate to a non-profit organization that has 501© status. The organization has to go through the process to become certified. I assume you would be hard pressed to demonstrate that your homeschool satisfies the criteria. Oh, and there is a $400 filing fee. Quote Link to comment Share on other sites More sharing options...
Tenaj Posted September 4, 2013 Share Posted September 4, 2013 Would I need to incorporate my homeschool as a non-profit to grant tax deductions for donations to my homeschool? I have a number of wealthy business owners who are friends of ours that when they give to us for school I'd like to repay the kindness. I think you can "gift" up to 500.00 to anyone and use that on your tax returns. So maybe I wouldn't have to incorporate? (probably 350.00 when complete . . )) Any tax accountants online lol? You can only deduct donations made to a charitable or non-profit organization. There is no way to deduct a "gift up to $500 to anyone" on your taxes. Not sure how you would go about declaring your family as a non-profit org. Quote Link to comment Share on other sites More sharing options...
Mrs Mungo Posted September 4, 2013 Share Posted September 4, 2013 A charitable organization cannot exist solely to benefit one person or family. A gift to your family would not be tax deductible. I'm not a tax accountant, but I have helped set up private organizations with non-profit status. Quote Link to comment Share on other sites More sharing options...
RanchGirl Posted September 4, 2013 Share Posted September 4, 2013 (edited) Would I need to incorporate my homeschool as a non-profit to grant tax deductions for donations to my homeschool? I have a number of wealthy business owners who are friends of ours that when they give to us for school I'd like to repay the kindness. I think you can "gift" up to 500.00 to anyone and use that on your tax returns. So maybe I wouldn't have to incorporate? (probably 350.00 when complete . . )) Any tax accountants online lol? I think you're confusing two different things - gift taxes and tax deductible charitable contributions. An individual can gift up to $14,000 without paying gift taxes. This is not a deduction from or related to income taxes. http://www.irs.gov/uac/Publication-950,-Introduction-to-Estate-and-Gift-Taxes-1 Individuals and businesses can make charitable contributions to qualified charitable organizations and deduct the value of the contribution against income when filing income taxes. http://www.irs.gov/taxtopics/tc506.html http://www.sba.gov/community/blogs/community-blogs/small-business-cents/charitable-giving-and-tax-benefits-small-busine It is unlikely that your family's personal homeschool could become an IRS-sanctioned qualified charitable organization. http://www.irs.gov/Charities-&-Non-Profits/Charitable-Organizations/Exemption-Requirements-Section-501©(3)-Organizations The $500 figure I believe you are thinking of is the limit beyond which the value of non-cash charitable contributions must be substantiated on Form 8283 -- e.g. with an appraisal, receipts, etc. It has nothing to do with where the contribution goes. http://www.irs.gov/pub/irs-pdf/f8283.pdf Bottom line, if you want to repay the kindness of your wealthy friends who are donating to your homeschool (why don't my wealthy friends ever do this?), bake them cookies and send a nice thank you note. Edited September 4, 2013 by Moderator Removed the politics... Quote Link to comment Share on other sites More sharing options...
Georgiana Daniels Posted September 4, 2013 Share Posted September 4, 2013 A good idea, in theory! Quote Link to comment Share on other sites More sharing options...
Catwoman Posted September 4, 2013 Share Posted September 4, 2013 No, you can't do what you're thinking of doing, and I can't help but wonder why "a number of wealthy business owners" would want to make tax deductible "donations" to your homeschool... or why would would even consider accepting multiple large "donations." :confused: :confused: :confused: Quote Link to comment Share on other sites More sharing options...
Spryte Posted September 4, 2013 Share Posted September 4, 2013 No, you can't do what you're thinking of doing, and I can't help but wonder why "a number of wealthy business owners" would want to make tax deductible "donations" to your homeschool... or why would would even consider accepting multiple large "donations." :confused: :confused: :confused: I am confused about this also. Quote Link to comment Share on other sites More sharing options...
RosieCotton Posted September 5, 2013 Author Share Posted September 5, 2013 Thanks for all the great responses. I didn't figure it would be worth it, unless we get sent to Egypt once we're done with the Ancients! Quote Link to comment Share on other sites More sharing options...
Catwoman Posted September 5, 2013 Share Posted September 5, 2013 Thanks for all the great responses. I didn't figure it would be worth it, unless we get sent to Egypt once we're done with the Ancients! Sorry we couldn't give you the answer you wanted to hear! :) Quote Link to comment Share on other sites More sharing options...
RosieCotton Posted September 5, 2013 Author Share Posted September 5, 2013 No, you can't do what you're thinking of doing, and I can't help but wonder why "a number of wealthy business owners" would want to make tax deductible "donations" to your homeschool... or why would would even consider accepting multiple large "donations." :confused: :confused: :confused: Oh it's simple, because they'd rather give their money toward my homeschool efforts and my family, rather than to a government who cannot pass a budget in 4 years. Quote Link to comment Share on other sites More sharing options...
Catwoman Posted September 5, 2013 Share Posted September 5, 2013 Oh it's simple, because they'd rather give their money toward my homeschool efforts and my family, rather than to a government who cannot pass a budget in 4 years. I'm just not sure why an idea like that would even remotely occur to them. It seems incredibly off-the-wall. I have been homeschooling for years and have never known anyone who tried to do such a thing, nor could I imagine anyone wanting to make "deductible donations" to a homeschool family. We own a CPA firm, and in all honesty, if one of our clients had suggested anything of the kind to us, we would have assumed it was some sort of scam. I'm glad you asked about it here before you approached an attorney or an accountant about setting it up. Quote Link to comment Share on other sites More sharing options...
RosieCotton Posted September 5, 2013 Author Share Posted September 5, 2013 Ok thanks Cat, good to know! Quote Link to comment Share on other sites More sharing options...
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