Tax Deduction for Donating Art
Is it really tax season again already! Well, believe it or not, there is a tax write-off available for donations of art. The IRS rules require that you have owned the artwork for a minimum of 12 months and that the artwork is donated to an IRS-approved charity. The amount you can deduct on your tax return for a charitable donation of art is the appraised fair market value (FMV) of the artwork. My article gives all the tax help you need to take this deduction and also explains what to do now so that you can claim this write off next year if it’s not available to you for last year. The way to maximize this tax write-off is to buy art at less than fair market value whenever you can, hold it for a year, and then donate it to the charity of your choice and take the full fair market value for the year in which you make the donation. Effectively if you are lucky enough to be able to buy works at below market value, you will get a deduction for an amount greater than what you paid out in cash.