Forfeited deposit = Charitable donation?

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quadsixm
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Forfeited deposit = Charitable donation?

Postby quadsixm » Thu Jul 29, 2010 8:36 pm

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Last edited by quadsixm on Tue Apr 09, 2013 10:52 pm, edited 1 time in total.

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Matthies
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Re: Forfeited deposit = Charitable donation?

Postby Matthies » Thu Jul 29, 2010 8:41 pm

OMFG I just spit sosda all over my keybaord. You made my night.

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quadsixm
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Re: Forfeited deposit = Charitable donation?

Postby quadsixm » Thu Jul 29, 2010 8:46 pm

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Last edited by quadsixm on Tue Apr 09, 2013 10:52 pm, edited 1 time in total.

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Thu Jul 29, 2010 11:56 pm

You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

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im_blue
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Re: Forfeited deposit = Charitable donation?

Postby im_blue » Fri Jul 30, 2010 4:02 am

Allitigator wrote:You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.

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IAFG
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Re: Forfeited deposit = Charitable donation?

Postby IAFG » Fri Jul 30, 2010 4:05 am

i like this idea

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Kohinoor
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Re: Forfeited deposit = Charitable donation?

Postby Kohinoor » Fri Jul 30, 2010 5:01 am

IAFG wrote:i like this idea

I like it because in two years it will be a "Will this be a C&F issue?" thread.

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Fri Jul 30, 2010 11:55 am

im_blue wrote:
Allitigator wrote:You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

If multiple seat deposits cannot work cause a candidate willingly knew they could not decide on what law school to attend, what about just one seat deposit that is refundable via taxes? That is, you pay one seat deposit that counts toward tuition at the school that you are definitely attending, and if you paid a seat deposit at another school, you can claim this one seat deposit on your taxes as a job related expense. Multiple deposits, should then mean, seat deposits that are more than one not including the seat deposit at the institution where student is currently enrolled and presumed to begin classes leading to a career. In this manner, a student is not allowed to claim multiple deposits, but can claim a single seat deposit.

IMHO, losing seat deposits seems anti-student and in this economy, ever penny counts. This is a policy that needs to be tackled, and I feel is contributory to an unfair learning environment.

Great contribution to TLS everyone.

theantiscalia
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Re: Forfeited deposit = Charitable donation?

Postby theantiscalia » Fri Jul 30, 2010 12:06 pm

Allitigator wrote:
im_blue wrote:
Allitigator wrote:You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

If multiple seat deposits cannot work cause a candidate willingly knew they could not decide on what law school to attend, what about just one seat deposit that is refundable via taxes? That is, you pay one seat deposit that counts toward tuition at the school that you are definitely attending, and if you paid a seat deposit at another school, you can claim this one seat deposit on your taxes as a job related expense. Multiple deposits, should then mean, seat deposits that are more than one not including the seat deposit at the institution where student is currently enrolled and presumed to begin classes leading to a career. In this manner, a student is not allowed to claim multiple deposits, but can claim a single seat deposit.


I hadn’t considered your question, but as a CPA who forfeited a deposit myself, I found it interesting. I asked my tax coworkers.

According to Publication 526, “If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive.” Here, there isn't any indication that you received a benefit.

I’d take the deduction. You’ll almost certainly never be questioned, and if you are, you can always argue that you received no benefits. This couldn't be construed as an aggresive tax position, so there is little risk in doing it.

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dominkay
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Re: Forfeited deposit = Charitable donation?

Postby dominkay » Fri Jul 30, 2010 12:12 pm

theantiscalia wrote:
Allitigator wrote:
im_blue wrote:
Allitigator wrote:You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

If multiple seat deposits cannot work cause a candidate willingly knew they could not decide on what law school to attend, what about just one seat deposit that is refundable via taxes? That is, you pay one seat deposit that counts toward tuition at the school that you are definitely attending, and if you paid a seat deposit at another school, you can claim this one seat deposit on your taxes as a job related expense. Multiple deposits, should then mean, seat deposits that are more than one not including the seat deposit at the institution where student is currently enrolled and presumed to begin classes leading to a career. In this manner, a student is not allowed to claim multiple deposits, but can claim a single seat deposit.


I hadn’t considered your question, but as a CPA who forfeited a deposit myself, I found it interesting. I asked my tax coworkers.

According to Publication 526, “If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive.” Here, there isn't any indication that you received a benefit.

I’d take the deduction. You’ll almost certainly never be questioned, and if you are, you can always argue that you received no benefits. This couldn't be construed as an aggresive tax position, so there is little risk in doing it.


Why isn't the fact that they held the seat for him a "benefit?"

theantiscalia
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Re: Forfeited deposit = Charitable donation?

Postby theantiscalia » Fri Jul 30, 2010 12:12 pm

Just to add: I think it is a terrible idea to try to push it off as a job expense. First, you probably won't overcome the 2% rule, so you probably couldn't do it anyway. Secondly, you're a student, not an attorney, and it isn't related to a job you currently have. (You can deduct job search expenses in certain situations, but this isn't related to a job search either.)

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Fri Jul 30, 2010 12:18 pm

theantiscalia wrote:
Allitigator wrote:
im_blue wrote:
Allitigator wrote:You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

If multiple seat deposits cannot work cause a candidate willingly knew they could not decide on what law school to attend, what about just one seat deposit that is refundable via taxes? That is, you pay one seat deposit that counts toward tuition at the school that you are definitely attending, and if you paid a seat deposit at another school, you can claim this one seat deposit on your taxes as a job related expense. Multiple deposits, should then mean, seat deposits that are more than one not including the seat deposit at the institution where student is currently enrolled and presumed to begin classes leading to a career. In this manner, a student is not allowed to claim multiple deposits, but can claim a single seat deposit.


I hadn’t considered your question, but as a CPA who forfeited a deposit myself, I found it interesting. I asked my tax coworkers.

According to Publication 526, “If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive.” Here, there isn't any indication that you received a benefit.

I’d take the deduction. You’ll almost certainly never be questioned, and if you are, you can always argue that you received no benefits. This couldn't be construed as an aggresive tax position, so there is little risk in doing it.



In theory, it can work. I haven't yet been victim to multiple deposits, but the possibility keeps growing everyday.

Given the nature of our profession and how where we receive schooling matters almost 100%, *blaming* a law school candidate for paying multiple deposits is inconceivable.

If I end up having to fork over another grand for a seat deposit, I'm going to claim it on my taxes, and write an argument supporting my claim. Nothing to lose and all to gain.

The only problem is that the law schools might claim they are not charities by the *traditional definition of charity.* But law school accept donations on a daily basis, I'm assuming. So one would have to pay attention to the language.

theantiscalia
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Re: Forfeited deposit = Charitable donation?

Postby theantiscalia » Fri Jul 30, 2010 12:25 pm

"Why isn't the fact that they held the seat for him a "benefit?"'

That could certainly be argued, but this isn’t similar to the types of things the IRS generally construes as “benefits.” They’re more concerned with things like the value of the meal if you buy a ticket to a charity dinner. Think of it this way: if you make a donation to a charity with the intent that they’ll put you on the board, you don’t have to reduce your contribution by the “value” of serving on the board. And if you bought a ticket to a charity event for $100, at which you were going to receive a $20 meal, you could certainly deduct the full $100 if you didn’t accept the meal.

It is certainly arguable from the opposite side, and that is how they'd argue it. But I think he stands on better ground. Further, even if you lose a couple of thousand in lost deposits, when multiplied by even the highest tax bracket, the IRS would be quibbling over a few hundred dollars. They don’t even look at things of that size. And even if they did, they’d just make you pay the difference, as he would have adopted an approach that a reasonable person could take. (I.e. it is not an aggressive tax position.)

theantiscalia
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Re: Forfeited deposit = Charitable donation?

Postby theantiscalia » Fri Jul 30, 2010 12:26 pm

"The only problem is that the law schools might claim they are not charities by the *traditional definition of charity.* But law school accept donations on a daily basis, I'm assuming. So one would have to pay attention to the language."

They would certainly qualify as a charity, unless they're a for profit. Most law schools would fall under the universities 501(c)(3) umbrella.

PS: I was shocked to learn for profit law schools exist. WTF?
Last edited by theantiscalia on Fri Jul 30, 2010 12:27 pm, edited 1 time in total.

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Fri Jul 30, 2010 12:27 pm

dominkay wrote:
theantiscalia wrote:
Allitigator wrote:
im_blue wrote:Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

If multiple seat deposits cannot work cause a candidate willingly knew they could not decide on what law school to attend, what about just one seat deposit that is refundable via taxes? That is, you pay one seat deposit that counts toward tuition at the school that you are definitely attending, and if you paid a seat deposit at another school, you can claim this one seat deposit on your taxes as a job related expense. Multiple deposits, should then mean, seat deposits that are more than one not including the seat deposit at the institution where student is currently enrolled and presumed to begin classes leading to a career. In this manner, a student is not allowed to claim multiple deposits, but can claim a single seat deposit.


I hadn’t considered your question, but as a CPA who forfeited a deposit myself, I found it interesting. I asked my tax coworkers.

According to Publication 526, “If you receive a benefit as a result of making a contribution to a qualified organization, you can deduct only the amount of your contribution that is more than the value of the benefit you receive.” Here, there isn't any indication that you received a benefit.

I’d take the deduction. You’ll almost certainly never be questioned, and if you are, you can always argue that you received no benefits. This couldn't be construed as an aggresive tax position, so there is little risk in doing it.


Why isn't the fact that they held the seat for him a "benefit?"


It would depend on what you mean by benefit, and how benefit is used. A seat deposit is beneficial, but that does not change the fact that it is a required expense.

A seat deposit gives us the benefit of being able to attend a law school. We don't have to pay it, but if we don't, we will not be attending law school.

Regarding the employment classification of law students, oddly enough, even though law students live dirt poor in most cases, being a full-time student can be labeled a job.

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im_blue
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Re: Forfeited deposit = Charitable donation?

Postby im_blue » Fri Jul 30, 2010 5:44 pm

Allitigator wrote:
im_blue wrote:
Allitigator wrote:You would have to get receipts from whatever schools and the receipts should specify you as a donor via seat deposits. If this is no-go, try to claim them under miscellaneous expenses, since seat deposits are required expenses to become an attorney. So, when you become an attorney, claim your expenses and get a fat pay check.

Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

Everyone else was able to pay one seat deposit at the school they attend. You couldn't decide and therefore wasted his money on multiple deposits. See the difference there?

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Fri Jul 30, 2010 6:38 pm

im_blue wrote:
Allitigator wrote:
im_blue wrote:Terrible idea. Seat deposits count toward tuition if you attend, and multiple seat deposits are definitely not a required job-related expense by any stretch of the imagination.



Yes. They count toward tuition if you attend. What happens when you pay a seat deposit, but you do not attend?

The seat deposit, even if you did not attend, is a requirement. It has to be made no matter.

Why not be able to claim it as a required expense?

Everyone else was able to pay one seat deposit at the school they attend. You couldn't decide and therefore wasted his money on multiple deposits. See the difference there?


I love your reasoning method. I haven't seen someone appeal to the majority in a while. I hear about this type of fallacy in logic books, but not IRL.

So, because everybody else paid the deposit (whether they were able to pay the deposit is a different story), I should not be able to claim seat deposits that were spent on other schools to hopefully get some of my money back?

Secondly, we're not debating seat deposits at a school that one is attending. We're debating deposits that people lose cause they had the opportunity to pay more than one deposit to increase their chances of success.

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bilbobaggins
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Re: Forfeited deposit = Charitable donation?

Postby bilbobaggins » Fri Jul 30, 2010 6:54 pm

Threads like this one are why people hate talking to lawyers and CPAs at parties.

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Fri Jul 30, 2010 7:13 pm

bilbobaggins wrote:Threads like this one are why people hate talking to lawyers and CPAs at parties.


If people hate talking to lawyers and CPAs at parties, then why do they do it? This thread is interesting.

Renzo
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Re: Forfeited deposit = Charitable donation?

Postby Renzo » Fri Jul 30, 2010 7:28 pm

Nah.

It's a gambling loss.

Allitigator
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Re: Forfeited deposit = Charitable donation?

Postby Allitigator » Fri Jul 30, 2010 7:33 pm

Nightrunner wrote:
Allitigator wrote:
bilbobaggins wrote:Threads like this one are why people hate talking to lawyers and CPAs at parties.


If people hate talking to lawyers and CPAs at parties, then why do they do it? This thread is interesting a ridiculous attempt to put a square peg into a round hole, and then rationalize it away.


Bye.

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bilbobaggins
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Re: Forfeited deposit = Charitable donation?

Postby bilbobaggins » Fri Jul 30, 2010 7:54 pm

Allitigator wrote:
bilbobaggins wrote:Threads like this one are why people hate talking to lawyers and CPAs at parties.


If people hate talking to lawyers and CPAs at parties, then why do they do it? This thread is interesting.


I really try not to.

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quadsixm
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Re: Forfeited deposit = Charitable donation?

Postby quadsixm » Fri Jul 30, 2010 8:52 pm

[]
Last edited by quadsixm on Tue Apr 09, 2013 10:52 pm, edited 1 time in total.

javajoe
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Re: Forfeited deposit = Charitable donation?

Postby javajoe » Sat Aug 07, 2010 12:27 pm

I'm not a CPA, but I've worked with CPAs have been a tax preparer for a couple of years.

Here is my take-

Umm, no... :)

I can't argue with the spin that says there is no benefit if you don't wind up attending the institution. But the fact is that this is a required deposit in order to hold a seat. It is NOT a donation.

Genericswingman
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Re: Forfeited deposit = Charitable donation?

Postby Genericswingman » Sun Sep 26, 2010 10:09 pm

I don't a think a forfeited seat deposit would count as a charitable contribution because you received valuable consideration for the seat deposit, mainly an option that gives you the right but not the obligation to attend a particular law school.




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