rccardr 

Cranky, that's an interesting viewpoint. Not sure how many upscale bikes are donated as part of an estate liquidation vs. donated because it's easier than selling when making a new bike purchase, but you might be right. On the other hand, no lunch is free. You got your bikes for a great price, but the donating owners in theory should only be able to deduct what you paid for them.

Setting a deduction value for donated property (as opposed to cash) gets complicated if you want to do it right and not have things get unhappy if questioned by the taxing authority:
1) anything over a couple hundred bucks requires an official appraisal by a reasonable authority, or a comparable valuation based on actual sales
2) if the item is given by the nonprofit to an actual end user, the donating party can deduct the value of comparably sold items based on willing seller/willing buyer (e.g. completed and paid eBay sales or sales from a used bike shop)
3) If the receiving nonprofit entity sells the donated item, the max the donating party should be able to claim is the actual selling price. As I recall, this was put in place to end the scam where an owner would donate a used car or boat to a charity and get a huge deduction, but the charity sold off the donated vehicles in bulk or bia auction and received much less in cash than the claimed deduction.

Not trying to be the expert here, just a guy who's had to muddle through this stuff in the past with an accountant. YMMV.

Steve Whitlatch 

You never gave the $1000 to begin with. You gave $700. The Government gave the other $300. I never forced the government to pay for my charity. I left them out of it.

wrk101

Depending on your definition of working Americans, they already rarely itemize. Realize the standard deduction is not indexed for income. So people with $50K in income more rarely have enough deductions to make itemizing worth it. Meanwhile, someone making $1,000,000 in income will have no problem rapidly coming up with deductions far in excess of the standard deduction.

Once the standard married deduction doubles next year, itemizing will become even rarer. "Big Fish" individuals will quickly run into caps on mortgage interest, state and local taxes and more.

From the tax foundation website: "It’s not surprising that high-income households are more likely to itemize deductions. Households with high incomes are likely to pay more in state and local taxes, take out larger mortgages, and have more disposable income to donate to charity – each of which can lead to a sizeable deduction for households that itemize. Furthermore, deductions are more valuable for households that fall into higher tax brackets, giving high-income households a stronger incentive to keep the necessary records to itemize."

Deductions are worth a lot more to people that pay a tax rate of 40% than people that pay 10%.

Steve Whitlatch 

I am bowing out of this thread. It will only lead to bad blood. I am happy I am getting a tax cut. It will really help my family.

Fahrenheit531 

I will not be getting a tax cut. I will be among the many millions who are screwed over the long term. Eff this thread, the so-called leader that is making a precious few even more spectacularly rich, and whoever supports him.

And if that gets me banned, so be it.

EDIT: Why is this thread even still here two pages in? Disgusting. Subtle shilling for these self-serving criminals is still shilling and has ZERO place here.

Steve Whitlatch 

Wow! It just got ugly!

Chrome Molly

Exactly my point SW. In a before vs after situation, the $300 that the government gave to charities is now going to those in the highest income bracket, and then some since it's also a major leverage play. Leverage in the sense future tax payers are funding the net impact of the gains (going mainly to the top income bracket) and losses (minor losses to middle class earners that have a lot of deductible activities).

The question was the impact to charities. I'm not saying the former situation was right or wrong, just assessing the impact to 501(c)(3) organizations and the offsetting gains per the new tax law. I'm a CPA who has read the entire bill, parts two or three times. If this sounds like I'm advocating one way or another, that's not my point at all. Just passing along what I and many others see as the likely outcomes, and the impact to charities is certainly a big one.

The real wild card is if the extra trillion to trillion-five of added debt (in addition to the current rate of debt loading) will have a substantial impact on ongoing borrowing costs; considering the current national debt is already at some 18 trillion. At some point, that ship may set sail, turning it back around will be nearly impossible. But then again, there is so much money chasing even marginal investments these days...

What I find more interesting than the more obvious stuff are the eventual impacts of things within the tax code. Several of these might turn out being far different than what the drafters of the code may have envisioned. For example, not being able to deduct mortgage interest on loans in excess of $750K and property taxes in excess of $10K might lead to a host of unintended consequences for communities that presently consider themselves as well to do. Forgive my BBA in accounting with minor in Econ geekyness...

As for the actual question posed, most of the bikes I give away go to kids up and down my block that need a decent bike when they go to college. None of the neighborhood kids are a charitable organization (at least not officially), so no change here...

StanSeven

This thread moved into Political. Time to close.