Our goodwill closed in town and people are wanting to donate item's to my consignment shop. I didnt think this is allowed, so can i accept the items and sell them and than give 60% of the sales to the safe homes in our area!!!
Well, you can do it. However, the donors are looking for a tax deduction and the way they get that is by donating to a nonprofit, technically a 501(c)(3) organization. Apparently neither you nor the "safe homes" are 501c3s so no one gets a deduction. If the safe homes qualified, you could get a deduction but your donors would not.
DISCLAIMERâ€”This answer is for informational purposes only under the AVVO system, its terms and conditions. It is not intended as specific legal advice regarding your question. The answer could be different if all the facts were known. This answer does not establish an attorney client relationship. I am admitted only in California. (Bryant) Keith Martin sbbizlaw.com
As alluded to in the previous post - what you cannot do is tell people you are accepting charitable donations. You also want to be careful in stating that you are giving to a particular charity because you could subject yourself to state charitable solicitation laws. As a general rule, there is nothing to stop you from taking items from the public and then donating proceeds. I suggest that you have a policy that anyone who wants to give your shop items to sell without and they are not being compensated that you will donate a large portion to charity. Keep it vague and simple.
If you are making money off the consignment shop, you may continue on as a for-profit business.
Curt Harrington Patent & Tax Law Attorney Certified Tax Specialist by the California Board of Legal Specialization PATENTAX.COM This communication is general information and not legal advice, and does not create an attorney-client relationship. This communication should not be relied upon as any type of legal advice. Please note that no attorney-client relationship exists between the sender and the recipient of this message in the absence of either (1) a signed fee contract and (2) remission of an agreed-upon retainer. Absent such an agreement and retainer, I am not engaged by you as an attorney, nor is any other member of my law firm.
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