Donations

[misskeiko]

Hi,

If the client provides a 500 dollars discount to school for its products. And it is tax deductible donation. Should I put it in 50% limitation Noncash contribution?

Thank you!

[abctax55]

I'd put it as a cash donation..right after I included it in income though.  And be sure to consider the impact of that on self-employment tax.

If you don't include it in income, it isn't a donation.  It's foregone income - with no tax consequences.

[qbteachmt · Accepted solution]

To quote a favorite participant to this community: You cannot write off what you did not write on. That's why you need to claim the full gross income, if you intend to claim the missing $500 as a write off, as well. Forfeiting a sale or selling at a lower price is not donation. In business, if you already took a credit for that cost, you do not also get a donation expense.