Fundraising Organizations May Be Unconsciously Hurting Artists

By Lee Zimmerman, November 30, 2010

Requests for art donations to fundraisers  create conflict for local artists. Many artists want to donate to a fundraiser's cause, but if they do so they hurt themselves financially.

i) Little to no tax benefit to artist for donation - Visual artists cannot deduct the retail price of their work from their taxes. They can only deduct the cost of materials. This means that to the IRS, a handmade Raku pot is worth only the cost of the clay it took to make it.

ii) Tendency to suppress prices and saturate the local area with the artists work- Most donation request come locally and personally. Often the fundraisers, without meaning to, undersell the artwork which greatly suppresses the price at which the artist can sell their work. The artwork from the fundraiser is often purchased locally. This process saturates the local community, often an artist's best customers, with the artist's work.

iii) Multiple requests per year - In any community their are many competing groups that are doing great work, that fund a portion of that good work through fundraising events. Local Artists are often the recipients of multiple donation requests.

iv) Minimum bid often doesn’t cover the cost of framing- Because art is often auctioned together with other kinds of business donations, there is an impression that they are equivalent in value (Tennis shoes = watercolor). This can greatly undervalue the artwork. A participant in an auction may find a "good deal" but in the end devalues all the work created by the artist and in essence devalues their own purchase.

v) Artists can only afford to donate less saleable work - If an artist is receiving no financial benefit from the donation, it only makes sense that they donate less saleable work to the fundraiser. I have seen a working artist, whose paintings regularly sell for more than $20,000 apiece, donate a lesser work to a fundraiser which sold it at auction for $5,000 from which he received no financial benefit. He could not afford to donate a better painting.

Possible Solution:

1) The minimum bid would be paid to the artist – minimum set at 30-50% retail cost.
2) If the artwork did not reach that minimum bid, it would be returned to the artist.
3)  Make it easy for the artist to donate the money they earn from their work, back to the fundraiser.

This example Artist/Event contract offers a solution