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Hi,
If the client provides a 500 dollars discount to school for its products. And it is tax deductible donation. Should I put it in 50% limitation Noncash contribution?
Thank you!
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I'd put it as a cash donation..right after I included it in income though. And be sure to consider the impact of that on self-employment tax.
If you don't include it in income, it isn't a donation. It's foregone income - with no tax consequences.
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To quote a favorite participant to this community: You cannot write off what you did not write on. That's why you need to claim the full gross income, if you intend to claim the missing $500 as a write off, as well. Forfeiting a sale or selling at a lower price is not donation. In business, if you already took a credit for that cost, you do not also get a donation expense.
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