F@H Federal Tax Writeoff

[niko084]

Don't forget you more serious folders..

If you can get the amount of power consumed by your folding systems you can write that off.
You can also write off the cost of the equipment along with your personal time used to set it up and maintain it.

This doesn't mean a lot to some people, but to others this can add up very quickly.

Yes, this is legal, I just checked it with a CPA, they did recommend that if anyone is planning on doing it though to get in contact with a accountant to make sure you have all your paperwork together as needed.


***
This is getting me very tempted to roll out a few systems and get some sli action going on.

 

[Homeless]

Care to go into more detail?

 

[1Kurgan1]

Yeah, very curious here, I would be completely up for folding if it's a write off, I don't really have the cash to pay the power or for parts out of my own pocket.

 

[PaulieG]

Taken from an old thread at overclockers:

"Amedeo602
08-23-01, 12:00 PM
I emailed the accounting professor at my college and he emailed me back! (he got my name wrong though....he didn't even get the correct sex...lol)

Good Morning Georgianna:
If the only reason Stan has these PC are to assist the
non-profit organization, then the operating costs -
electric,
diskettes, repairs, insurance, etc. could be taken as a charitable contribution on schedule A. One could give the PC's to the non-profit as a tax write-off but keep the
PC's in tact and operate them for the non-profit.

If Stan has a business, and the philosophy of the business
is
to "give back" to the community in this form, the operating costs may be small compared to total operating costs of the
business, I probably would have a tendency to include the
costs of running the PC's as part of the business operating costs.

I hope my thought process may help."

 

[nflesher87]

interesting stuff however, and not that Stanford would ever attempt such a thing, wouldn't we be essentially forfeiting ownership of all hardware to Stanford?:

One could give the PC's to the non-profit as a tax write-off but keep the
PC's in tact and operate them for the non-profit.

 

[[Ion]]

Extremely interested in this, subbed

 

[PaulieG]

From macrumors.com:

"The IRS has a "standard deduction" for charitable donations - you can claim $250 WITHOUT needing any receipts; a "written acknowledgement" (receipt) is needed for amounts >$250, and donations >$5000 require a qualified written appraisal. So, if your "donation" to folding is worth up to but not exceeding $250/year, you can most likely just go ahead and do it without worrying about documentation (assuming you make no other charitable donations throughout the year). If you believe it is worth more than $250 a year, consult with a tax professional to figure out what exactly you need and then contact the Folding administrators to see if you can get what you need from them."

 

[DanishDevil]

I was browsing around the F@H web site, and I remember there being "Certificates" for the TPU team as far as how many points were folded. Maybe something like that would contribute to your proof?

 

[A Cheese Danish]

Definitely interested in this. Subed for additional information on how to get this.

 

[mlee49]

From macrumors.com:

"The IRS has a "standard deduction" for charitable donations - you can claim $250 WITHOUT needing any receipts; a "written acknowledgement" (receipt) is needed for amounts >$250, and donations >$5000 require a qualified written appraisal. So, if your "donation" to folding is worth up to but not exceeding $250/year, you can most likely just go ahead and do it without worrying about documentation (assuming you make no other charitable donations throughout the year). If you believe it is worth more than $250 a year, consult with a tax professional to figure out what exactly you need and then contact the Folding administrators to see if you can get what you need from them."

I claim a 'donation' for $250 every year. It's not much, but I would like to see the money used to buy the hardware a deduction. Then it could be interesting, I'd write of my i7 rig

Really the deduction one would be seeking may not be exactly what you want. You may not get back the money you turn in as a deduction, it's just removed from taxable income. Adjusted Gross Income is whats left. Really one could claim a small business as an "Independent Consultant" for 'free lance' work and claim standard deductions like, utilities, gas, maintenance, and other legal expenditures. 9/10 times if your business doesn't claim a loss over 10,000 the gov will most likely not audit you. Granted they have 3 years to go back so they have time to check and re-check. All I can say is there is limited return on claiming your electric bill on your taxes(unless you have a folding farm).

 

[PaulieG]

From the IRS:

"Contributions You Cannot Deduct

There are some contributions you cannot deduct. There are others you can deduct only part of.

You cannot deduct as a charitable contribution:

A contribution to a specific individual,

A contribution to a nonqualified organization,

The part of a contribution from which you receive or expect to receive a benefit,

The value of your time or services,

Your personal expenses,

A qualified charitable distribution from an individual retirement arrangement (IRA),

Appraisal fees,

Certain contributions to donor advised funds after February 13, 2007, or

Certain contributions of partial interests in property."

So, what are qualified organizations? Here you go....

"Types of Qualified Organizations

Generally, only the five following types of organizations can be qualified organizations.

A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). It must be organized and operated only for one or more of the following purposes.

Religious.

Charitable.

Educational.

Scientific.

Literary.

The prevention of cruelty to children or animals.

Certain organizations that foster national or international amateur sports competition also qualify.

War veterans' organizations, including posts, auxiliaries, trusts, or foundations, organized in the United States or any of its possessions.

Domestic fraternal societies, orders, and associations operating under the lodge system.

Note. Your contribution to this type of organization is deductible only if it is to be used solely for charitable, religious, scientific, literary, or educational purposes, or for the prevention of cruelty to children or animals.

Certain nonprofit cemetery companies or corporations.

Note. Your contribution to this type of organization is not deductible if it can be used for the care of a specific lot or mausoleum crypt.

The United States or any state, the District of Columbia, a U.S. possession (including Puerto Rico), a political subdivision of a state or U.S. possession, or an Indian tribal government or any of its subdivisions that perform substantial government functions.

Note. To be deductible, your contribution to this type of organization must be made solely for public purposes.

Example 1. You contribute cash to your city's police department to be used as a reward for information about a crime. The city police department is a qualified organization, and your contribution is for a public purpose. You can deduct your contribution.

Example 2. You make a voluntary contribution to the social security trust fund, not earmarked for a specific account. Because the trust fund is part of the U.S. Government, you contributed to a qualified organization. You can deduct your contribution."

Pay attention to item 1d "scientific". I'd say folding and crunching would qualify. One of my oldest friends is an accountant in Philadelphia. I'm going to call him tomorrow and see what he thinks.

 

[Steevo]

I use the high deductable write off for my PC expense every year anyway, 50% deduction off my taxes owed from my IT salary. I get to write off my DSL, hardware, and since I have a home office and use my PC for work also I get to write off that in taxes.

 

[W1zzard]

i doubt you can write off the purchase of hardware without making f@h the owner of that hardware. but the power bill sounds reasonable if you can present evidence how much power is used for folding, that this power is used for folding, how much it cost you and that folding is a qualified organization

 

[Flyordie]

Meh CPA gave me the green light... I told him to tack $225 to "BOINC+SETI", under "Cost of maintenance, Electricity ect..." . I will be the Guinea pig for this one... GRRR

 

[W1zzard]

225 is below 250, unless you have other stuff to charitable orgs there is nothing to worry about. the interesting part is when you declare 251 to 4999 usd

 

[niko084]

i doubt you can write off the purchase of hardware without making f@h the owner of that hardware. but the power bill sounds reasonable if you can present evidence how much power is used for folding, that this power is used for folding, how much it cost you and that folding is a qualified organization

Indeed the hardware is the funky one, I know that legally if you could claim it you "couldn't" use it for personal use without getting into a lot of other mess...

 

[MoonPig]

Is this just a US thing? Or does the UK have an equivalent?

I'd happily fold 24/7 if i could get help on the bills. Even without folding their fairly high.

 

[W1zzard]

i'm sure the uk tax system has something related to charitable organizations .. but you definitely need to look at the details

 

[Steevo]

i doubt you can write off the purchase of hardware without making f@h the owner of that hardware. but the power bill sounds reasonable if you can present evidence how much power is used for folding, that this power is used for folding, how much it cost you and that folding is a qualified organization

I write it off as a business expense for myself, I have to claim self employment on my IT stuff anyway, so hardware purchases are made to check the use of certain software our business uses, for me to keep up to date on hardware, software, and I still don't like to but I use my system as a whore for some parts to make sure they work OK.


I found the way to use a program in Win Vista X64 and Win 7 that the mfg doesn't say works, and is not compatable. They tried calling my boss to get a copy of it after i fixed it, and have tried negotiating with me to get a copy. They may have it for $5,000.00 the same cost our IBM support contract is for, and no one ever bothers to show up when I call.

 

[vaiopup]

Hi

Don't wanna be a bore but I don't see how it could be workable.

1: Proving that hardware is used solely and exclusively for the "charitable work" would be nigh on impossible, as would be

2: Proving which power consumption costs are attributable to said computer use.

Certainly could never see the idea fly in the U.K.

 

[W1zzard]

whats the legislation on donations in the uk ? 1 and 2 are fairly easy to prove

 

[vaiopup]

To be honest I have never looked into it because around these parts is not renowned for it's tax breaks.

I would settle for just being able to reclaim the VAT on hardware

 

[aCid888*]

I would settle for just being able to reclaim the VAT on hardware

+1 to that.



I'd start a WCG farm if I knew I could get some money back for the running cost or I could claim back some form of tax on the purchase of parts to put together a farm.

 

[1Kurgan1]

This is interesting, my question is, dont you need to furnish some sort of folding proof even when claiming under $250? I mean if not whats to stop anyone from just claiming money each year under $250?

 

[niko084]

This is interesting, my question is, dont you need to furnish some sort of folding proof even when claiming under $250? I mean if not whats to stop anyone from just claiming money each year under $250?

It's up to them to prove you lied, not up to you to prove you didn't.

Remember without a strong case it's not worth their time to even try to hit you with it, the costs out weigh the benefit.

A simple showing of your folding scores should more than suffice.

It's like millage records for business trips, you just make a log, who is to say you didn't add 500 miles to the ticket, no proof really as long as it's not completely obscene.

Don't take this like a "go ahead and lie" ticket but it's the truth.
Also why you contact a cpa and make sure you do have what you would need. After you have that it's the CPA's problem and worst case you just have to pay the extra few bucks in taxes vs face criminal charges.

As I said, probably not worth it to the small guys, but some people fold on $10,000 in equipment and burn lord only knows how much electricity, it's cheap here but I know other places it's not so much.