Occupation: Artist/Donor

     If you're an artist or a business owner, you're familiar with the phrase: "We're having a fundraiser and were wondering if you'd consider donating..." Many businesses, artists and artisans donate thousands of dollars worth of merchandise to local charities and benefits each year.  I'm blessed to have a talent that can generate money to assist people (for much of my life, my art was all I could afford to give), but it's a big financial and emotional strain on artists when lengthy lists of organizations all ask for contributions of artwork for their fundraisers.   

     Although it is good exposure, when there are several local benefit auctions featuring donated art work, it actually devalues the art, as people begin to think that rather than buy it from the artist or gallery, they'll pick it up for less at a benefit auction and also contribute to a good cause.  This is not always the case, as sometimes live-auctioned work goes for more than it would on a gallery wall, but in the current economy, donated work generally brings in less money.  A low-selling auction sale can set a precedent that affects the artist's pricing and sales, as well as art sales in the community.

      It is a common misconception that the artist gets to "write-off" for taxes the value of that which he or she donates, however, artists are only allowed to write-off the cost of materials and supplies used in the creation.  There is no write-off for time and talent, so even when a donated piece with a fair market value of $750 sells at a charity auction for $1000, it could provide as little as a $20 write-off (depending on supplies & framing) for the artist.  So instead of making $730 on the outright sale of the piece, this artist is essentially providing a $1000 contribution in exchange for a $20 tax write-off -and the debatable "good exposure" previously mentioned.  Furthermore, if an artist donates art to a fundraising auction that does not charge sales tax (if applicable) when they sell the work, the artist is technically responsible to pay the state and local sales tax on any supplies used in the work which were not taxed when they were purchased. 

    I'm happy to donate art to worthy causes, and I enjoy the advertising it provides, but in order to keep my work from becoming stale on the "benefit auction block," I should choose quality over quantity, and donate good pieces to a select number of causes that are important to me.  

     Some businesses and philanthropic individuals help all concerned by purchasing, then donating art by local artists, thereby the artist earns income, and the donor receives recognition and/or advertising along with an actual cost-based tax write-off.  Some museums encourage high quality art donations by offering artists the option to keep a percentage of the earnings at auction, and they reward those who donate 100% with more advertising & perks.

      Fundraisers, appreciate your artist donors, and, since they are donating as a kindness only and not as a tax write-off, kindly send them a thank you note.  And don't forget to ask other people with sought-after skills -your dentist, mechanic, lawyer, CPA, LPC, financial advisor, etc.- for a donation of their valuable time for your next fundraising event- I'd bid on that!