Donate or Auction? That is the Question.

At Hoffman Auctions, we believe in the power of auctions. “Auction First” and “Auctions Work” are core principles that guide us. However, we also recognize that in certain situations, a donation with an appraisal for tax deductions may be a more advantageous path. Our extensive experience allows us to guide clients in making the most financially sensible decisions for their unique circumstances.

Understanding Appraisal for Donation

An appraisal for donation involves determining the fair market value of an asset that you plan to donate to a qualifying charitable organization. This value can then be used to claim a tax deduction, potentially reducing your taxable income.

Potential Benefits of Donating for Tax Deductions

  1. Tax Savings: Donating assets can result in tax deductions. Depending on your tax bracket, this might translate into significant savings. For high-value items, the tax deduction might exceed the net proceeds you’d get from an auction after fees and taxes.
  2. Avoiding Auction Costs: Selling assets at auction involves various costs, including auctioneer fees, marketing expenses, and potential storage fees. These costs can eat into your profits. By donating, you avoid these expenses entirely.
  3. Immediate Financial Relief: When you donate an asset, you might be able to claim the tax deduction in the same year, providing more immediate financial relief. Auction sales might take longer, especially if the asset is specialized or niche.
  4. Supporting Charitable Causes: Beyond the financial considerations, donating allows you to support causes and organizations you care about. This can provide a sense of personal satisfaction and social responsibility.

Market Trends and Manufactured Collectibles

Market trends play a crucial role in determining whether to sell an asset at auction or donate it for a tax deduction. One notable trend is the oversaturation of manufactured collectibles in the market. Items such as Hummel figurines, Boyd’s Bears, and Longaberger baskets were once highly sought after, but now face a glut in the market. This oversupply has driven down auction prices, often making them less attractive for sellers.

For example:

  • Hummel Figurines: These once-popular collectibles now struggle to achieve their retail value at auction due to high supply and low demand.
  • Boyd’s Bears: Similarly, these plush bears, which were once collectible items, are now abundant in the secondary market, reducing their auction prices.
  • Longaberger Baskets: These handcrafted baskets face the same issue, with auction prices frequently falling below their original retail value.

In such cases, the standard retail value of these items is generally higher than the prices realized at auction. Therefore, donating these items and using their fair market value for a tax deduction might be more financially beneficial.

Scenarios Where Donation May Make More Sense

  1. Low Auction Demand: If the market for your asset is currently weak, selling at auction might not fetch the best price. In such cases, the fair market value used for the tax deduction might be higher than the auction proceeds.
  2. High-Value, Low-Liquidity Items: Items that are valuable but not in high demand might sit at auction without attracting bids. For these items, an appraisal for donation can often reflect their true value more accurately.
  3. Rapid Disposal Needs: If you need to liquidate assets quickly, auctions might not always provide a timely solution. Donating allows for faster disposal and immediate potential tax benefits.
  4. Complex or High-Cost Items: Some items require extensive marketing or come with high selling costs. By donating, you can bypass these complexities and still reap potential financial benefits through tax deductions.

Recommended Charities for Donation

At Hoffman Auctions, we often recommend registered 501c3 charities for donation purposes. Some of the organizations we suggest include:

  1. Shelters for Battered Women: These charities help battered women get back on their feet by providing items for their new homes. Your donation can make a significant difference in someone’s life by providing them with essential household items.
  2. Animal Shelter Thrift Stores: Some thrift stores use all proceeds to support local animal shelters. Donating to these stores not only helps animals in need but also provides you with a valuable tax deduction.

We are happy to offer suggestions for places we have worked with that provide such services, including those that will pick up the items in exchange for the donation. This convenience makes the process even more seamless and beneficial for you.

Our Expertise at Your Service

At Hoffman Auctions, we pride ourselves on our ability to navigate the complexities of asset liquidation. Whether you are considering an auction or a donation, our team is here to provide expert guidance. Our goal is to help you achieve the best possible financial outcome while aligning with your personal values and preferences.

How to Get an Appraisal

  1. Find a Qualified Appraiser: Ensure your appraiser is qualified and experienced in valuing the type of asset you plan to donate. They should comply with IRS regulations and provide a detailed appraisal report.
  2. Understand IRS Requirements: The IRS has specific requirements for appraisals used for tax deductions, especially for high-value donations. Ensure all documentation is thorough and meets these standards.
  3. Consult a Tax Professional: Work with a tax advisor to understand the implications of your donation and how it fits into your overall tax strategy. They can help maximize your deductions and ensure compliance with tax laws.


While auctions are a powerful tool for asset liquidation, there are times when an appraisal for donation may offer greater financial benefits. By understanding market trends and recognizing the scenarios where this approach might make sense, you can make more informed decisions about your assets. Whether you’re dealing with oversaturated collectibles or other valuable items, considering a donation for tax deductions might be the best path. Hoffman Auctions can provide expert guidance on both appraisal and auction options to help you choose the best strategy for your unique situation.