C

ccryan

Active Member
Hey guys, just wanted to share an idea I had.

I recently cracked the canopy on my RV-4 during installation. I quickly ordered a new one from Todd's,(just got here the other day and he makes beutiful canopies), and contacted the local A&P school to inquire as to whether they'd be interested in a canopy to practice repairs on. They said yes so I will donate it to them and take a deduction at the end of the year.

Seemed a shame to throw the canopy away and now I'm going to actually get most of my money back that I spent on the new one.

I did'nt know if anyone else had thought of or posted this idea before so I thought I'd share my idea with you all. Hope this helps anyone in the same boat as me.

Chris
 
I'm confused. Assuming you're donating to a recognized charity, the most you can legitimately deduct is the fair market value of a cracked canopy. I can't imagine this being even $100. The reduced tax as a result could be what, maybe 30 bucks? What am I missing?
 
How is the IRS going to know the canopy was cracked? Just make sure the form the school gives you (and now you have to provide a form for every charitable contribution, not like previous years), you have to have it in writing what the market value is.
 
ccryan said:
Seemed a shame to throw the canopy away and now I'm going to actually get most of my money back that I spent on the new one.

Chris
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Excuse me, but might we have tax deduction confused with tax credit ?

John Clark
RV8 N18U "Sunshine"
KSBA
 
So you don't tell 'em

It was cracked....Deduct the full value..

All well and fine except that would be fraud and that means I get to pay more...Not cool!....

You wouldn't do this would you??

Frank
 
Builders Insurance

If you have builders insurance, this is a covered situation. I cracked mine during installation also. I contacted nationair who was the issuer of my builders policy and filed a claim. The cost of the canopy was covered along with the amount of time I had investing in working with it up to that point.
 
I don't see how it's fraud. Suppose the A&P school wanted to buy a canopy to work on from the same place we do. Wouldn't they pay full value? I suppose it depends on how badly cracked it is but aren't there a lot of RVs out there with some cracking in the canopy? A crack alone doesn't necessarily make it worthless, does it?
 
N520TX said:
If you have builders insurance, this is a covered situation. I cracked mine during installation also. I contacted nationair who was the issuer of my builders policy and filed a claim. The cost of the canopy was covered along with the amount of time I had investing in working with it up to that point.
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Was there a deductible involved here? I should probably get some builders insurance before starting this.
 
I don't think so...

I don't recall completely, but I'm pretty sure there was no deductable. It's a cheap investment - about $400 if I recall for a year. Not a bad hedge for me since the canopy was a $1,000 item.

Most all homeowners insurance policies do NOT cover anything aircraft related - no matter what the damage is or how it was caused.
 
Bob Collins said:
I don't see how it's fraud. Suppose the A&P school wanted to buy a canopy to work on from the same place we do. Wouldn't they pay full value? I suppose it depends on how badly cracked it is but aren't there a lot of RVs out there with some cracking in the canopy? A crack alone doesn't necessarily make it worthless, does it?
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C'mon now. It's fraud if you claim more than the fair market value, ie., what it would SELL for on the open market. There is no way that a cracked canopy is worth even close to full value.

Also, it is only a deduction if the school was a not-for-profit organization, so a typical trade school doesn't count.
 
Wow

I did'nt expect so many responses! When I said "most" of my money back that I spent on the new one I never said what I spent on the new one. Todd gave me a spectacular deal that I dont want to disclose, but a donation to a school or university does not have to be to a non-profit school for a tax deduction. Anything you give to your alma-mater,(we all get those requests in the mail), is tax deductable. As far as the value of the canopy, I paid $600 dollars for it. It's still a perfectly good canopy that could be installed on an aircraft. The crack is repairable and in the rear out of the line of sight of the pilot. So I dont see why it's not still worth $600. I dont want to get into any trouble with the IRS, and I dont cheat on my taxes so if I'm dead wrong please tell me.

Regars,
Chris
 
I think it comes down to

What is the honest value of a canopy with a crack in it?....We havent seen the crack but even if I could use it would expect to pay less than full price.

If you can donate this thing and with a straight face say its worth $600 then all the good for you....If you can't then you have a personal dilemma....My advice, deduct the honest value and do the right thing.

As far as the iRS is concerned it is unlikely they will audit you...but they might..:)

Ok..I'm out of the pulpit now...:)

Frank
 
ccryan said:
a donation to a school or university does not have to be to a non-profit school for a tax deduction. Anything you give to your alma-mater,(we all get those requests in the mail), is tax deductable. As far as the value of the canopy, I paid $600 dollars for it. It's still a perfectly good canopy that could be installed on an aircraft. The crack is repairable and in the rear out of the line of sight of the pilot. So I dont see why it's not still worth $600. I dont want to get into any trouble with the IRS, and I dont cheat on my taxes so if I'm dead wrong please tell me.

Regars,
Chris
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Hi Chris,

I certainly never meant that you were attempting to cheat on your taxes, just that the FMV of a cracked canopy can't possibly be equal to that of an uncracked one. We both know that not a single person on here would pay $600 for it when they could buy a new one instead. Regarding the for-profit thing, chances are your alma mater is not-for-profit; however, many trade schools are for-profit and these cannot be used for tax deductions.
 
Builders Insurance covers booboos? I did not know that. I wonder how far that extends? Has anyone else used builders insurance for similar situations? Curious.
 
Thanks for all the input guys.

This is my first post and I never thought I would learn so much about taxes from this web site! In any case I did some checking and yes the school is and has to be non-profit for it to be a tax deduction...which most schools and universties are.

Second, I need to determine the FMV for the canopy. I still need to bring it to the school and determine that I guess. But the fact of the matter is it's still a canopy that can still be used as a canopy, so I dont think its fair to say it's worth only 100 dollars or so.

If someone completely destroys their canopy during construction but wants to save some money buying a new one, wouldnt he be willing to pay me a good price for mine that is slightly below new price? Dont forget the savings on shipping. Anyway, I think this topic has been beaten to death. Thanks for all the input.

I guess the moral is it's still going to be a tax deduction and I'm still getting something out of an unfortunate mistake I made.
 
Good point, Ned

Mine was cracked due to a 4x4 falling on it. Didn't occur to me that the *way* the damage happened might be a factor in whether or not it is covered.
 
ccryan said:
I guess the moral is it's still going to be a tax deduction and I'm still getting something out of an unfortunate mistake I made.
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Not to mention you're helping out some aspiring A/P's too. That alone is a pretty cool thing. :D
 
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