Keep More of Your Profits: A Deduction You Might Not Be Aware Of
By donating its excess, nonmoving inventory to charity, a corporation can earn an above-cost federal tax deduction, under Internal Revenue Code Section 170(e)(3). In some cases, this deduction can be as much as twice the donated products’ cost.
Prime candidates for donation are discontinued products, customer returns, cancelled orders, seconds and unpopular, slow selling merchandise.
Since this deduction was first made available in 1976, thousands of companies have used this strategy to their advantage. NAEIR collects corporate product donations at its ten-acre warehouse in Galesburg, Illinois and then redistributes those goods to over 13,000 charities and schools across the United States. American businesses have donated over $3 billion worth of their new and unused products to NAEIR since its founding in 1977.
Clearing out merchandise is an effective way for a business to reduce its taxes and get leaner, while helping charities and schools at the same time. Most businesses have excess inventory in their warehouse or storeroom. These are products that budget-strapped nonprofits and schools can put to good use. When a business person discovers the boost this deduction can give their company’s bottom line, they scour their facilities for inventory to donate.
Among the companies that have donated products to NAEIR are 3M, Oreck, Newell-Rubbermaid, Tupperware and Avery-Dennison. Donors include manufacturers, wholesaler/distributors and retailers.
Give us a call now at 1-800-562-0955, or go to www.naeir.org and click on the donor tab on the left hand side of the page. We’ll show you how to go about donating your excess inventory quickly and easily.
