Spencer Christopher Yacht and Ship works with Block Island Maritime Funding, whose boat donation programme has funded marine education charities for over twenty years. For some owners it beats another season on the market — here is how it works, in their words.
Selling is not the only way to part with a boat. Spencer Christopher Yacht and Ship works with Block Island Maritime Funding, a boat donation programme that has funded marine education charities for over twenty years — and for some owners, in some markets, donating is the better answer than another season on the market.
Block Island Maritime Funding manages boat donation programmes for a growing number of marine-related nonprofit organizations. In their words, these organizations “concentrate on maritime education for youth from a variety of socioeconomic backgrounds. Many of our affiliated partners teach boating skills, while others concentrate on marine science, history, boatbuilding and conservation.” Donated boats are either put into direct use by an affiliate that needs that particular boat, or they enter a lease-to-own programme that raises funds for the charities.
Block Island Maritime Funding, Inc. is based in Wakefield, Rhode Island and can be reached on (401) 842-0752. Nothing on this page is tax advice: BIMF’s own guidance is that state rules vary and that a tax professional should be consulted on an individual’s specific circumstances.
The steps below are Block Island Maritime Funding’s, other than the first — that one is ours, and it is the one an owner should take before any of the others.
This is the one step that is ours rather than theirs. A broker here will look at the vessel, the market she sits in and what she is realistically worth, and tell you plainly whether a sale or a donation serves you better. Donation is not the right answer for every boat, and a broker who tells you otherwise is not doing the job.
An arm’s-length appraisal is central to the process. It is carried out by a third-party marine surveyor hired by the donor, and it is what sets the value of the deduction. A donated boat valued over $5,000 must be appraised within 60 days of the donation, and BIMF can provide a list of surveyors to donors who need one.
Upon donation, all costs to the donor cease and immediately become the responsibility of Block Island Maritime Funding — storage, transportation, maintenance, insurance, repairs and broker’s fees. BIMF also takes complete legal responsibility for the vessel, including processing the documents for the donor, the IRS, accountants and lawyers. In their own answer: the donation can be implemented almost immediately, in a few days.
Donation papers are formalised with a Deed of Gift and IRS forms 1098-C and 8283, the second signed by both the receiving charity and the appraiser. IRS guidelines require the charity to hold title for three years for the donor to receive the full appraised value — which is why BIMF’s lessees take a boat on a three-year interest-free lease with an option to purchase at the end of it.
Once a boat has been chartered, BIMF distributes funds as grants to the charities it represents — over 35 marine nonprofits, working in youth seamanship, boat building, marine and fisheries science, maritime history and coastal conservation. Donors have the option of selecting from a number of those charities to allocate the proceeds of their donation to.
Yes. Block Island Maritime Funding runs a boat donation programme for a growing number of marine-related nonprofits, and Spencer Christopher Yacht and Ship can put you in touch. BIMF’s own case for it is that boats begin to lose value after 45 days on the market, while storage, maintenance, insurance, brokerage fees and possible repairs keep running — and that upon donation all of those costs cease.
Block Island Maritime Funding states that an individual donor or a couple filing jointly can deduct the appraised value of the boat as a charitable deduction on their federal tax return in the year the boat is donated, up to 50% of adjusted gross income. If the entire appraised amount cannot be used in year one, BIMF states that under IRS rules the balance can be carried forward for five years. State rules vary; consult a tax professional.
The donor. BIMF states that the responsibility usually sits with the donor because it is important that an independent third party establishes the donation value — normally a marine surveyor. Cost varies with the type, location and size of the boat, but BIMF puts it generally between $15 and $25 per foot of length.
BIMF’s answer is that if a boat is seaworthy and in operable condition, call them or complete their donation form and they will make contact. Whatever is included in the appraised value should come with the boat — typically everything, unless special arrangements are agreed and signed off before the donation.
Block Island Maritime Funding. They state that once the boat is donated they assume responsibility for all costs, including yard bills, maintenance, insurance and transport, and take complete legal responsibility for the vessel.
Donated boats are either put into direct use by an affiliate nonprofit that needs that particular boat, or they become part of BIMF’s lease-to-own programme — leased out for three years interest free, with an option to purchase at the end of that term — to raise funds for the charities BIMF represents.
Block Island Maritime Funding states that broker commissions are paid on boats donated to BIMF on behalf of a broker’s clients. That is their arrangement to describe, not ours — but it is the reason a broker here can give you a straight answer on donation without it costing you anything to ask.
It depends on the boat, the market she sits in and what she is realistically worth today. A broker here will tell you plainly which of the two serves you better — including when the answer is to keep her listed.
