Legal Questions & Answers: Tax Incentives and Food Donation for Gleaning Organizations

Introduction

Farmers and producers have many reasons to work with gleaning and food recovery organizations. Some farmers may wish to contribute to food security, build community, or provide hands-on experience to volunteers in the work of growing food. Tax incentives provide another potential benefit to farmers working with gleaning organizations. They offer tangible compensation and may recruit more farmers to expand gleaning operations.

Tax incentives are offered by the federal government and some states, and may depend on the business structure of the recipient organization (gleaning and food recovery organization). There are two types of tax incentives for food donation: tax deductions and tax credits. A deduction is subtracted from a taxpayer’s taxable income before tax is calculated and thus reduces the amount owed. A credit is so called because it is credited toward the amount of taxes owed and directly reduces the amount that must be paid. Some incentives may be available only for certain types of businesses. For an overview of business structures, please see the Farmers Market Legal Toolkit.

Read this guide to learn about incentives and whether your state offers a benefit for food donation.

Acknowledgments

This factsheet is presented by the National Gleaning Project, a partnership of the Center for Agriculture and Food Systems and the Association of Gleaning Organizations. We thank the following people for reviewing this factsheet: Laurie J. Beyranevand, Professor of Law, Director of the Center for Agriculture and Food Systems, Vermont Law and Graduate School; Janet Milne, Professor of Law, Director of the Environmental Tax Policy Institute, Vermont Law and Graduate School; Stephanie Willbanks, Professor of Law, Vermont Law and Graduate School; Emily Broad Leib, Faculty Director, Food Law and Policy Clinic, Clinical Professor of Law, Harvard Law School; Tori Oto, Clinical Fellow, Food Law and Policy Clinic, Harvard Law School; and Sophie DeBode, law student, Harvard Law School.