Playing freebies for established charities- tax breaks?

[pinkfloydcramer61]

Tomorrow I am playing at a dinner for the Make-A-Wish foundation. The assistant manager at the private club throws alot of work my way, with wedding rehearsal dinners and what-not. So when she asked me if I would consider donating my services, I said "yes" with no qualms. It's a great cause and I'm honored to be a part (because I'm a NICE guy, if you don't get the drift:)).

 

I have a weekly gig at the club that is reported to the guv'ment. So I am going to check into using the gig to alleviate the brutal SE taxes (nice guys need tax breaks, too:)). How does this work?

 

Almost all of my charity experience consists of playing in informal fund-raisers of the redneck variety, so please excuse my ignorance.

[capitalist]

I am in a volunteer/charity band where 100% of the time the band proceeds are donated to a charity. My C.P.A. said band members should keep track of their auto mileage for rehearsals and gigs for tax deductions. We cannot deduct money for our time from our personal taxes. He did not recommend depreciating equipment, vehicles, etc. The payee on the check from the venue/individual is the charity so the venue/individual gets the band performance for "free".

[BlueStrat]

I am in a volunteer/charity band where 100% of the time the band proceeds are donated to a charity. My C.P.A. said band members should keep track of their auto mileage for rehearsals and gigs for tax deductions. We cannot deduct money for our time from our personal taxes. He did not recommend depreciating equipment, vehicles, etc. The payee on the check from the venue/individual is the charity so the venue/individual gets the band performance for "free".

 

 

Maybe you need a better accountant.

 

I do benefits all the time and have them write me out a receipt for value of services rendered on their organization's letterhead or receipt book and sign it. I then present it to my accountant. It goes into the charitable donations column. Your performance time is most certainly worth money, and can be deducted.

[capitalist]

Bluestrat, in this situation both of us may be correct. Our band is unique in that we perform essentially as agents of our charitable organization. Our band is not an incorporated business. Thererfore, the venue, wedding party, corporation, etc. is donating money directly to the charity. I believe the venue/proprietor and the band members would not be able to legitimately deduct the value of a performance. However, if we were an incorporated band it would be wise to deduct everything possible.

[mr3lions]

I don't know if this would work as I'm not familliar with the US tax system, but if the charity "paid" you a fee of say $1000.00 and you turned around and made a charitable "donation" of $1000.00 could you not work around it that way? Or would you get dinged too hard on the income from the original paycheck?

 

Just a thought.

[BlueStrat]

Bluestrat, in this situation both of us may be correct. Our band is unique in that we perform essentially as agents of our charitable organization. Our band is not an incorporated business. Thererfore, the venue, wedding party, corporation, etc. is donating money directly to the charity. I believe the venue/proprietor and the band members would not be able to legitimately deduct the value of a performance. However, if we were an incorporated band it would be wise to deduct everything possible.

 

Oh, I see. Yes, we hire out as contract entertainment, and donate the amount of the contract. Our situations are apples and oranges.

 

And good on you for being charitable.

[Zon5string]

It's called "donation in kind". You're donating your services to the charity. It has a value.