Taxpayer asks:
The PTA 501(c)(3) at my son’s local public elementary school sponsors a language and a chess class. Is the tuition we paid for these classes considered a charitable contribution?
Taxgirl says:
Probably not. You generally can’t deduct the cost that you pay for goods or services provided by a charitable organization.
There is a but. If the charitable organization provides a breakdown of the cost and breaks out the difference between the fair market value of the goods or services received from the cost of any donation, you can take a deduction for the donation.
Here’s an example: You pay $500 for a dinner sponsored by PETA. The FMV of the dinner is $50. The overage, or $450, is a donation.
Another example: You join an educational society and pay $50 in membership dues. In exchange, you receive a subscription to the society’s newsletter. The FMV of the newsletter is $15. The overage, or $35, is a donation.
But – and this is sooo important – get it in writing. Most charitable organizations will put the split into a letter; the portion of your contribution which qualifies as a donation will be separately stated. If they don’t offer one, insist on it.
Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation.
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{ 3 comments… read them below or add one }
This where my confusion with the Girl Scout cookies comes up. As good as the cookies are they are not worth what you pay for them and I think I could buy comparable cookies for about half the price you pay the girl scouts. So why can’t a dollar or two be shown as a contribution?
@ Rick: the girl scouts would have to do the necessary reporting to bifurcate each sale between deductible and non-deductible portions. That’s a lot to ask of that 9 year-old that sells you the cookies (and would eat into the profit margin. yuckety yuck yuck!)
I think on the side of the box in fine print it says how much of the price is for the cookies and how much you can deduct as a contribution to the Girl Scouts.
With the original question, it’s possible depending on the age of the child and other criteria that an afterschool class provided by the PTA would be eligible for a child care deduction.