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Q&A: Valuing Volunteer Labor

Are donated services deductible?

A church member who has a business donated numerous hours to rewire the church sanctuary and install new lighting. He billed the church on his company letterhead for items purchased that we reimbursed him for. In addition he listed total hours spent on the project and the value at an hourly rate. We can acknowledge that he did the work and the numerous hours he donated, but is that deductible for his taxes?

You are absolutely right that you may (and, from a donor relations perspective, probably should) express the church's gratitude for the generous gift of donated labor in the form of electrical services. As for the business, it is not entitled to an income tax deduction for donated services. Federal tax law is very clear that the value of donated services is not tax deductible.

While at first the law may seem unfair, if you look at it from a couple of different perspectives, it actually ...

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Posted:
  • October 7, 2009

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