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How do I enter a non-cash donation to a charity?

Voyager

I create and donate products to a charity. How do I enter them and keep balances correct?

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NotACPA

Not quite following. What balances need to be adjusted, if you're donating products? How are you recording those products in Q?

Chris_QPW

Also what edition (Deluxe, Premier, Home & Business) are you using?
I this part of a business?

NotACPA

Extending @Chris_QPW's helpful comment, OR is producing these products a hobby?

Voyager

" How are you recording those products in Q?"
That's my question. How to do that. I'm using Quicken Deluxe. I'm not in business. I buy materials and create products specifically for donating to a charity. Maybe it should be done the same way as donating clothing to the Good Will. How do you record that?

NotACPA

You can't donate something FROM Q if you haven't recorded it IN Q in the first place. How are you doing that?

Chris_QPW

Well since Quicken doesn’t have an “inventory” anything you do would be “faking it”.

So what I would probably do is create an asset account for this, where I would add a transaction that is for the amount of the value of the product. The category would a “balance adjustment” as in if you are in the “Asset” account it would be [Asset]. That will put the “product” value into Quicken. From there when you give it away you would just do a withdrawal with the charity category of your choice.

Voyager

Thank you for your suggestion, Chris. However, I'm still confused. Every time I make a donation, I'm already working on the next one. It seems like I would have to keep making "balance adjustments" to this account over and over. That doesn't seem like good bookkeeping. Maybe I should just keep it out of Quicken altogether, make the donations, and deduct them with TurboTax. Is that what should be done when donating clothing and household articles to the Good Will? Up until now, everything I enter into TurboTax comes from Quicken, and I just assumed that that had to be the case. I'm rethinking that.

I also consider the postage I pay to ship my finished products to be deductible. I guess that would have to be kept track of in Quicken, since it's a money outlay and the entry is needed to keep accounts balanced.

Chris_QPW

You could do something like adding memos to the transactions to keep them straight. In fact there is nothing wrong with the bookkeeping. The “balance adjustment” simply means that the amount should affect the balance of the account, but not any other account/category. This is true for anything where the asset comes from outside of Quicken.

On the other hand, personally I probably wouldn’t record it in Quicken, either in so program that record deductions like “It’s Deductible” or just in some other form like a spreadsheet.

q_lurker

First off, I agree that I would likely not try to track this type of donation in Quicken. You are not obligated to only supply info to your tax program through Quicken. Some things are better tracked elsewhere.

That being said, what is it you are actually donating and how are you valuing that donation? Example: You might be making wooden crafts and toys and donating them to a church sale or children's center. You might be valuing them based on the raw materials (wood and varnish) and expendables (sandpaper and saw blades). That then might lead you to build up an asset account (Donation Materials) as you buy those things and then reduce that account as you make the donations. Buying material at the store with your credit card would be a 'transfer' to that special asset account. When you made the donation, you would record an 'expenditure' or a payment from that account to the charity with a category as a 'non-cash charitable donation'.

bdflood

If I am making a non-cash charitable donation (old car, clothes, furniture, etc), I want to track the donation in Quicken so I can run a report at the end of the year that contains all cash and non-cash charitable donations. Here's what I do: I create a transaction (usually in my main checking account in Quicken). The Payee is the name of the charity. The amount of the donation (my estimate of the value of goods donated or the value on the receipt from the charity) goes in the Payment column. Under Category, I hit the "Split" button. You then get a pop-up for Split Transaction where I fill the the 1st Line Category as "donation" (or whatever category you use for cash donations) and I leave the 1st Line Amount as the value of the donated goods. On the 2nd Line, I fill in the category using a category that I do NOT use for any tax reporting. In my case, I use a category I created called "Misc Income". For the amount on the 2nd Line, I put in the negative of the amount of the donation. I then hit the "Adjust" button near the bottom. This changes the Split Total and the Transaction Total to $0.00. Now this transaction has no impact on the balance in my checking account register but when I run a report of my charitable donations, the value of the donated goods is included with all other cash donations.