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Expanded tax incentives benefit food producers

November 3, 2016 | Press Releases

Des Moines, IA, March 3, 2016 – Expanded federal tax incentives provide new opportunities for food producers to benefit from donations to food banks. New valuation structures and guidelines allow farmers and food producers to significantly increase the tax credits they may claim from food donations.

The allowable claim amount for charitable donations was raised from 10 percent to 15 percent, the formula for valuation of donated goods was revamped, and “cash method” farmers and other producers may now benefit in the same way as C corporations. Congress passed the changes in the December 2015 spending package.

“The expanded tax incentives are better for food producers and better for organizations like ours that receive donations,” said Danny Akright, communications manager for the Food Bank of Iowa. “When food producers get a greater benefit from the food they donate, food banks will see greater donations. The more fresh, nutritious food that we can provide to people in need, the better.”

In addition to raising the amount of claimable donations, the revamped valuation formula will provide food producers with a more accurate cost for the products they donate. Producers may now value donated goods by taking the cost of goods sold and adding one half the difference between the fair market value and the cost of goods sold. Prior to the changes, the producer could only claim the cost of goods sold. For example, a donated product has a cost of goods sold of $1 and a fair market value of $2. That product may now be valued at $1.50 when donated. The fair market value may be used even when the products do not meet internal standards.

For more information, visit https://www.foodbankiowa.org/GetInvolved/DonateFood/ExpandedFoodDonationTaxCredits.aspx.

For media inquiries, contact Danny Akright, communications manager, Food Bank of Iowa, dakright@foodbankiowa.org or 515-564-0330.

To learn how you can help fight hunger in your community, visit www.foodbankiowa.org

About Food Bank of Iowa

The Food Bank of Iowa is a private, not-for-profit organization committed to its mission of alleviating hunger through food distribution, partnership and education. The Food Bank of Iowa distributes donated food and grocery products through Iowa’s largest network of emergency food providers consisting of 390 partner agencies in 55 counties, 42 of these counties are served through their distribution center in Des Moines with the remaining 13 counties being served through their redistribution organization, The Food Bank of Southern Iowa. Besides traditional food banking, the Food Bank of Iowa operates five direct service outreach programs: BackPack Program™, Mobile Pantry, School Pantry, Fresh Produce and Help Us Stop Hunger (HUSH). Additionally, the Food Bank of Iowa conducts two outreach and community engagement programs: Food For Thought and Hunger 101. In FY 2015, the Food Bank of Iowa distributed 11,059,360 lbs. of food. To learn more, visit www.foodbankiowa.org or find us on Facebook at www.facebook.com/foodbankiowa.

Food Bank
Food Bank of Iowa | Administrator

The Food Bank of Iowa’s mission is to provide food for Iowa children, families, and seniors to lead full and active lives, strengthening the communities where they live. Serving 55 of Iowa’s 99 counties, the Food Bank of Iowa distributed 9,281,828 meals last year.