We're having a debate as to when it's appropriate to issue a tax ack. receipt after an auction. Some say never, that the donor should defer discussion with their tax preparer and leave our organization out of it, for fear we will give the wrong advise. Others, including myself, say that anything paid over the stated value of the item is a tax deduction. What are others doing?

I don't know if we are right or wrong, but we do not receipt people that receive goods and services from our auctions - the receipt of the item is considered the 'receipt'. Note: We do not 'appraise' the items and publish that amount in the program so there is no portion of the auction item we can technically refer to as a donation. (The actual auction and items are handled by a volunteer board, we just collect the $$ afterwards and distribute the items). We look at it like this: The person that donated the item needs to have it appraised and claim that amount independently on thier taxes. The person that purchased the item at the auction received goods and/or services so therefore it is not a 'donation', however they can claim whatever they want on their taxes - we're just not involved as we put a receipt value of $o.oo on lthe auction payments. Hope this helps. Laurel Quaintance Friends of Bassett Financial Analyst Cooperstown, NY 13326

The IRS website says that the only way for auction purchasers to claim a deduction is for them to prove that knew they were overpaying for an item based on the item's FMV. That proof can be the auction catalog, if that info is included. We have that info in our live auction catalog, but the only FMV info we make for our silent items is on the bid sheets themselves. And so, we send receipts showing FMV and purchase price paid for each item, with a disclaimer that they should consult their tax advisor for deductability. Check the site: http://www.irs.gov/charities/charitable/article/0,,id=123204,00.html  Karen Burlingame Special Events Program Assistant MultiCare Health System 253.403.3095

I wanted to edit my response since I was not incharge of the dept at the time the process was established. We now do receipt auction winners - we print the 'value' of the donated items in a booklet that is distributed as well as on bid sheets. We then subtract this value from the winning bid to determine the donation amount the winning bidder has made and this goes in the receipt field.

Though my current job does not include auctions (thank you, thank you, thank you) my previous employer held a large one very year.  We would thank every winner with a letter that listed the item(s), the FMV and the amount paid. It was up to the winner and or a tax advisor to decied if there was any tax deductibility. The FMV was determined by our volunteer committee by adding up the actual value of the items in each "basket".  As most of the items were new it was relatively easy to put a value on the baskets.  However, many were listed a priceless (autographed baseballs, footballs, jerseys, a ride in the Goodyear Blimp, and stuff like that).  I beleive the winner could not get a tax deduction for these.