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In
the United States, charitable giving to qualified non-profit
organizations has long been encouraged by the federal government.
The IRS encourages financial support of these
organizations.
The Charles F. Chapman School of Seamanship, Inc. qualifies
as such an entity, under IRS Code 501(c)(3) and the IRS has
continued our designation of this approval over many years.
Donations to our school make it possible for us to:
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Grant
scholarships to students preparing to go from school to
work.
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Update
our technology for use in our classrooms.
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Expand
our facilities & training programs.
How
you will benefit when you donate:
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Feel
good about a tax-deductible gift that benefits the students and
maritime programs of Chapman School.
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Say
“goodbye” to the time, energy, expense and stress involved in
trying to sell your boat.
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End
all expenses now for dockage, insurance, maintenance, storage,
repairs, financial investment and interest.
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Pay
no sale commissions, avoid providing buyer’s marine surveys or
dealing with
sea trials.
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Complete
the entire transaction in a few days.
HOW TO DONATE YOUR BOAT
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Contact the School by phone or
e-mail. (Include your phone number in your e-mail).
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From your initial phone
conversation, the School will ascertain details, location, and
overall condition of your vessel. It is very helpful to have
your title or document handy – which contains useful
information. Details of the new tax ramifications will be
discussed.
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An employee of the School will
contact you to set up an appointment to look at the vessel to
determine the suitability of the vessel to either, use it in its
training fleet or put it in its “for sale” program. The
proceeds of the vessel sale go directly back into the training
programs. For those of you that are out of state and wish to
donate your vessel, the School generally will send a local
representative to examine your vessel. (We have graduates of
our marine surveying program through out the USA).
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The new tax law pertaining to the
donation of boats, cars, and airplanes that is embedded in the
“American Jobs Creation Act of 2004” has generalized guidelines
and rules. The IRS is in process of writing the details and
interpretation of this new act. In the mean time, the new
requirements are fairly straight forward.
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For boats valued at $500 or less
the School will provide the donor with a copy of your “Deed of
Gift” which includes a description of the vessel, and an
official Thank You Letter stating the value of the donation.
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For boats valued at $5,000 or less,
but more than $500 the School will provide the donor with a copy
of your “Deed of Gift” which includes a description of the
vessel, and an official “Thank You Letter”.
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For boats valued over $500, the
amount of your deduction will depend on how the Chapman
School, “donee organization”, uses the vessel.
Vessels Sold
Many of the donated vessels are sold to
bring in much needed proceeds to help pay for scholarships,
programs, faculty, & campus. For those vessels that are sold, the
amount of your charitable deduction cannot exceed the gross proceeds
from the sale. When the vessel is sold, the School will provide you
with an “Acknowledgement Form” (contemporaneous acknowledgement)
stating the amount of the sale along with other IRS required
statements and information within 30 days. You are required to
submit the “Acknowledgement Form” with your tax return. In
addition, the School is required to provide the IRS with a copy of
the “Acknowledgement Form” within 30 days. The School will balance
trying to get a good price for the vessel as well as selling it in a
timely manner.
Vessels Used in Training
Programs
For those vessels that are used in the
School’s training programs, the School will provide you with an
“Acknowledgement Form” advising you of the intended use of the
vessel and the planned duration, generally in excess of one year,
along with other IRS required statements and information within 30
days.
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For boats valued at $5,000 or less,
but more than $500 a “qualified appraisal” is not a requirement
when the School decides to use the vessel in its training
programs. (As earlier stated, if the School sells the vessel
the gross proceeds apply.) However, a “fair market value” is
needed to be established, based on various boat value books and
adjusted for condition, available comparables, recent sales of
similar boats, and adjustments for physical condition. “It is
the price that would be agreed upon between a willing seller and
a willing buyer when neither is required to act and both possess
a reasonable knowledge and understanding of the facts.” The
established fair market value will accompany the
“Acknowledgement Form” for boats used in training programs.
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For boats valued over $5,000 but
less than $500,000 a “qualified appraisal” is required to be
kept in your personal files for proof of substantiation of
value. We can provide a list of independent appraisers to
assist you in obtaining an appraisal. The School will provide a
“Value Form” listing pertinent information to accompany your tax
return, i.e. name, tax ID# (social security number), brief
vessel description, appraisers name, address, ID# of the boat,
and appraised value.
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For boats valued over $500,000 a
“qualified appraisal” is required and must be attached to your
income tax return when filed.
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Arrangements can then be made for
delivery and transfer of ownership. Transfer of ownership is
simple whether the vessel is titled, registered or documented.
The above information is how
the Chapman School plans to interface between the donor and the IRS
for its particular type of organization, i.e. A Boating School
accepting Boat Donations. The intention of the above information is
not to give tax advice because we are not tax accountants or CPA’s
but to have a working model to aid in the donation process. For
this reason we urge all prospective donors to consult with their tax
accountants or advisors before making any donation that they plan to
take a charitable contribution. The official name of the School as
listed with the IRS is the Charles F. Chapman School of Seamanship,
Inc.
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