Aircraft Donations

Overview

We like to get completed and aircraft kit donations. Generally, we turn around and sell them quickly, but in some cases, we will use them for things like Youth Build projects.

Because EAA 292 is a 501(c)(3) charity, donors can take a tax deduction for the fair-market value of the kit or completed airplane. There are several possible paths to pursue.

Case 1: The plane or kit will be sold quickly (within 30 days!)

If the donor absolutely must have an IRS Form 1098C, and if we do not have a buyer lined up for a quick sale, work with the donor to postpone the effective date of the donation until we have a buyer. We MUST provide the donor with form 1098C within 30 days of the donation (IRS regulation).

1. Have the donor fill out and give us the donation bill of sale and affidavit of ownership (for non-LSA kits or scratch-builds)
2. Sell the kit or completed airplane within 30 days
3. Send the donor a donation letter and a completed IRS form 1098C to file with taxes. Affirm (Part 4a) that the donation was sold in an arm’s length transaction, provide the date of the sale and sales price in boxes 4b and 4c. IRS rules require that we return this form to the donor no later than 30 days from the date of the donation.

Case 2: The kit or plane will be used for a Youth Build or other project

If we plan to use the kit or airplane for a purpose related to our charitable mission (that is, aviation safety education) we must make significant improvements or changes to the donated kit or aircraft. That is, we need to be completing the donated kit or doing restoration to the donated airplane for educational purposes.

1. Have the donor fill out and give us the donation bill of sale and affidavit of ownership (for non-LSA kits or scratch-builds)
2. Get an appraisal of the kit or aircraft done. This provides the donor with the amount he/she can deduct.
3. Send the donor a donation letter and a completed IRS form 1098-C to file with taxes. Check box 5a and describe in detail what we plan to do with kit or airplane in section 5c. The donor files the form and deducts the appraised amount. IRS rules require that we return this form to the donor no later than 30 days from the date of the donation.

Case 3: The plane or kit cannot be sold quickly or used by Chapter

In this case things get a bit more complicated. We need to provide the donor with something to file with the IRS, but we don’t know exactly what the donation is worth.

1. Have the donor fill out and give us the donation bill of sale and affidavit of ownership (for non-LSA kits or scratch-builds)
2. Get an appraisal of the kit or aircraft done. This provides the donor with a provisional amount he/she can deduct.
3. Send the donor a donation letter and a completed IRS Form 8283 (non-cash charitable contributions).
1. Have the donor fill out the first page of the form (what he’s donating and how it was acquired).
2. Have the donor fill out Part II (usually blank) and Part III (Donor Statement).
3. Have the person who did the appraisal fill out and sign Part IV.
4. Have an EAA 292 officer complete Part V.
4. Close the loop with the donor and IRS:
1. If the kit or aircraft is sold or otherwise disposed of within 3 years (the usual case) we need to send both the donor AND the IRS a copy of Form 8282 (Donee Information Return) that describes who we are (EAA 292), the donor, a description of the donated property, and how we disposed of it.
2. If the kit or aircraft is NOT sold or otherwise disposed of within 3 years, no further action is required.

Some notes about documents

There are generally a few documents that need to be given or exchanged when a completed aircraft or kit is donated to the Chapter.

Bill of sale (all aircraft and kits) provided by donor

For anything with an N-number (including uncompleted kits) use AC Form 8050-2.

For unregistered, uncompleted kits you can use the AC Form 8050-2, but be sure to note that it’s a “kit” and be sure that the manufacturer name, kit model, and kit serial number are recorded on the bill of sale.

For unregistered kits or scratch-built aircraft you can also use our own bill of sale form (simplified version of AOPA bill of sale) which:

1. Records that the donor has the actual right and title to the kit, without any liens or other claims that might mess up our claim to ownership
2. Records the manufacturer, kit type and kit serial number. This is important for establishing a "chain of ownership".
3. Shields (indemnifies) the donor from any subsequent liability claims

We can always use two bills of sale (Form 8050-2 and EAA 292 form) to be sure that all of the information required is captured.

Affidavit of Ownership (experimental A/C kits) provided by donor

NOTE: This form instructions state that it is not required for kits (like the RV-12) that are registered as LSA. The MOSAIC rules may make this form unnecessary in most cases, but better safe than sorry.

If the donor is giving us an unregistered experimental aircraft, we will need to get a notarized AC form 8050-88 from the donor. This establishes the chain of ownership for the kit or plans-built components and certifies that at least 50% of the work was done by the donor.