How often are you hit up for a donation of your art?
All artists are, at some point, asked to donate their work for a good cause. Most artists have soft hearts and want to help out anyone who asks.
The problem is that U.S. tax laws prevent artists from deducting fair market value for their donations. You can only deduct the cost of materials.
In light of this rule disfavoring artists, you might think these philanthropists are testing the limits of your love and commitment to their cause. But they’re only doing their job.
Rather than get upset about being asked, resign yourself to the fact that you will be asked for donations. You need to be prepared with a response that reflects your boundaries while educating those doing the asking.
It’s perfectly fine to have a policy against donating your art under any circumstances.
If you choose to donate, you’ll be well served with written guidelines that you can share in a moment’s notice. These donation guidelines could include the following three aspects.
1. The Education Piece
People should be reminded that the tax laws do not favor gifts from artists – that you cannot receive a full tax deduction from a donation. They should also understand the value of your art and why you can’t donate to every worthy cause.
It’s your job to educate them.
They need to know that your art career is a serious endeavor, and that you rely on the full-value sale of the work to feed yourself and your family.
2. The Organizations You Support
You cannot support every cause, so choose one or two that are closest to your heart. Identify specific organizations by name since you can’t even support every organization within a cause.
This is where I get on my soapbox and preach to artist organizations that ask for donations from their members. I believe that any organization whose mission it is to support artists should offer artists a percentage of sales to artists – even at fundraisers.
3. The Monetary Value Limit
Even though you might not be able to deduct the full-market value of a piece you donate, you are still losing the potential of the full-value income from it. What are your donation value limits?
Set an amount for the year and stick with it.
Two Alternatives for Donating Your Art
Rather than donating outright and creating guidelines like those listed above, you might offer a couple of alternatives that could allow you to donate much more frequently.
The first option is for the organization to buy your art at wholesale and sell it for as much as they can get. I like this option because it incentivizes them to maximize the sale price.
The other option is for you or the organization to find a donor that can buy the work, donate it for the auction or sale, and receive a full-value tax deduction.
Too many artists have been burned by disorganized events, lousy auctioneers, and devastating sales prices after donating their art. With policies and expectations in writing, you should be able to spread the love of your art to the nonprofits whose work you support.
Resources for Artist Donations
Two artists share the language they use in response to donation requests:
Nancy Teague offers the guidelines she sends in response to donation requests. (PDF)