Tax guidelines for boat donations

The tax law pertaining to the donation of boats, cars, and airplanes is embedded in the American Jobs Creation Act of 2004 and 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.

For boats valued at $500 or less NWSWB 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.

For boats valued at $5,000 or less, but more than $500, NWSWB 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.

For boats valued over $500, the amount of your deduction will depend on how the School uses the vessel.

Vessels Sold

Donated vessels not improved or used in a program will be sold to bring in much needed proceeds to help pay for scholarships, programs, faculty, & campus.
The amount of your charitable deduction cannot exceed the gross proceeds from the sale.
Within 30 days of the sale NWSWB will provide you with an Acknowledgement Form (contemporaneous acknowledgement) stating the amount of the sale along with other IRS required statements and information.
You are required to submit the Acknowledgement Form with your tax return.
NWSWB is required to provide the IRS with a copy of the Acknowledgement Form within 30 days.
NWSWB will try to get the best possible price for your vessel. We reserve the right to price aggressively to mitigate ongoing storage and maintenance costs.

Vessels used in School 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 and planned duration along with other IRS required statements and information within 30 days.

Boats valued at $5,000 or less, but more than $500

A marine survey is not a requirement.
A "fair market value" will be established, based on various boat value books and adjusted for condition, available comparables and recent sales of similar boats. "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.

Boats valued over $5,000 but less than $500,000

A marine survey is required and must be kept in your personal files for proof of substantiation of value.
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, surveyors name, address, ID# of the boat, and surveyed value.

Boats valued over $500,000

A marine survey is required and must be attached to your income tax return when filed.

The above outline is provided for informational purposes only. It is not tax advice and should not be taken as such. We urge all prospective donors to consult with their tax advisors before making any donation that they plan to take as a charitable contribution. The official name of the School as listed with the IRS is Northwest School of Wooden Boatbuilding.