Donating bitcoins - tax implications & deductions

[keystroke]

When donating to a charity does it make tax sense to sell the coins first and donate cash? Or donate BTC directly? Anyone know how this works w/ deductions?

It seems like EFF says BTC can be donated like a stock.

 "You can now give Bitcoins to EFF in the same way that you can give stock.  EFF has long had a policy that converts gifts of stock and items like cars into cash immediately on receipt. We try to convert your donations into action as soon as possible."

Then again if you cash out - long term capital gains rates are 0% in certain income brackets.

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[chris200x9]

I think it's best to cash out and donate cash, I mean unless you declare your bitcoin as income. How would it look to get audited and be like "Oh this donation is legit I did it with bitcoin though even though nowhere do I report my bitcoin earnings."

[CobaltBlueD]

I love the idea of the donating via BTC.  Assuming you are worried about the write-off, I see two issues. BTC is more anonymous than the government would prefer.  Demonstrating you donated BTC has some inherent difficulties (at least with the US IRS).  The other item, I'm not sure how many flags I want to flag for the IRS.  Being audited is no fun.  Trying to explain BTC to the auditor would be quite a chore.

[Stephen Gornick]

Assuming you are worried about the write-off, I see two issues. BTC is more anonymous than the government would prefer.

Charities accept cash and Bitcoin should actually be more desirable as it is a payment method that offers a form of triple entry accounting.  Triple entry is the most transparent method for bookeeping that other ledger systems for charities should emulate!

 - http://iang.org/papers/triple_entry.html