Fair market value rules, IRS Form 1098-C, Form 8283, the qualified appraiser requirement, AGI limits, carry-forward provisions, and the four things most owners get wrong. Written in plain English, from 25 years inside the industry.
Updated 26 May 2026. This guide reflects current US Internal Revenue Code provisions and IRS publications as of May 2026. It is general information, not personal tax advice — the application to your specific return belongs to your CPA or tax attorney. The author is a yacht industry executive, not a tax professional.
You donate a yacht (or a corporation holding a yacht) to a qualified 501(c)(3) nonprofit — in our case, The International SeaKeepers Society (EIN 58-2385869). A qualified independent appraiser determines the vessel's fair market value. SeaKeepers issues IRS Form 1098-C documenting the contribution. You file Form 8283 with your federal return. The deduction reduces your taxable income up to 50% of your adjusted gross income in the year of the gift, with any excess carried forward up to five additional years. The rest of this guide is the detail behind that paragraph.
The IRS does not care what you paid for the vessel. The deduction is based on the vessel's fair market value at the time of donation — the price a willing buyer would pay a willing seller in an arm's-length transaction, neither under compulsion to buy or sell. For most well-maintained yachts in soft markets, fair market value is materially below what owners think it is, and materially above what brokers asking for a quick sale will quote. The qualified appraisal — not the survey, not the broker BOV — is what the IRS will rely on if your return is examined.
This is the most expensive mistake owners make. A marine surveyor assesses vessel condition — for insurance, financing, or a purchase decision. A qualified value appraiser, as defined in IRS Regulations §1.170A-17, performs the formal valuation that supports a charitable contribution deduction. They are different roles, with different IRS-required credentials. If you submit a marine survey as your "appraisal," the deduction will be disallowed on examination. Period. The donor engages and pays for the appraisal; the charity is barred by IRS rule from paying for it.
Three documents:
For donations of long-term capital gain property (which most yachts qualify as) to public charities, the deduction is capped at 30% of adjusted gross income in the year of the gift. If you elect to deduct only your cost basis instead of fair market value, the cap rises to 50% of AGI — rarely the better choice for an appreciated asset. Any deduction that exceeds the cap can generally be carried forward and used over the next five tax years. For most owners donating yachts of meaningful value, the carry-forward provision is what makes the math work in any one tax year.
This is the rule that catches most "donate your boat to charity" programs. If the charity sells the vessel without using it materially in furtherance of its mission, the donor's deduction is generally limited to the gross proceeds the charity receives from the sale — not the fair market value. The exception is when the charity makes significant intervening use of the vessel (using it for research, programs, leases that further the mission, etc.) or makes material improvements before sale. SeaKeepers' DISCOVERY research program and its lease pathway are designed to qualify under this exception, which is what preserves the fair-market-value deduction. Donations to organizations that simply auction the vessel without intervening use leave the donor with the much smaller gross-proceeds deduction. Our services page covers how the disposition pathway is selected.
Yes. A vessel donated to a qualified 501(c)(3) such as SeaKeepers is fully tax-deductible at fair market value, supported by a qualified independent appraisal for vessels over $5,000.
Up to 30% of your adjusted gross income for fair-market-value deductions of long-term capital gain property to public charities (50% if you elect cost basis). The excess carries forward up to five additional tax years.
A qualified appraisal, performed by a qualified value appraiser. A marine survey will not satisfy the IRS requirement for the deduction.
SeaKeepers issues Form 1098-C. You file Form 8283 with your return. For vessels over $5,000, attach the qualified appraisal. For vessels over $500,000, the appraiser signs Form 8283 Section B Part III.
Most clean donations close within 4 to 8 weeks. Vessels with liens, joint ownership, or foreign flag take longer.
A confidential call with Paul Madden. Indicative fair-market range for your vessel and an estimate of the corresponding deduction, based on the comparable market.
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