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I developed an application that provides critical information in the event of an emergency for health care providers. The facility I designed it for uses it frequently but does not seem to have the budget to even cover the costs of the server rentals I use to support the application. I know this application saves lives but I also have bills to pay to keep it running.

My question is since they have not come up with a way they are going to pay for it can I recuperate the costs through some kind of write-off as if it was a donation or some other method?

I am in Texas in the United States.

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    For anything tax-related, you're going to have to say which country you're in (and, if the USA, probably which state).
    – TripeHound
    Commented Apr 21, 2022 at 11:13
  • If you do try to deduct donations (other than time/services) in US, the recipient must be a 501(c)(3) charity. While many nonprofit hospitals qualify for and do obtain that status, it isn't automatic; the organization must meet various conditions, apply, be approved by IRS, and file 990 annually. If this 'facility' can't even spend a few bucks on a server, they may not have spent the money/effort on (c)(3) application and compliance. In addition unless this falls under a business you operate and pay tax on, you can only deduct charity if you itemize, which many don't post-TCJA.
    – dave_thompson_085
    Commented Apr 22, 2022 at 2:48

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TL;DR No, you can't.

No tax jurisdictions let you claim a tax rebate for your time.

Here is a reference for the specific case of the USA.

There are two reasons. First, if they did this for you, they would also have to do it for everybody who volunteers their time for a charity, in any capacity. That would cost billions of your currency unit. Second, it's far too easy to scam. Someone shows up at a charity, does something completely pointless for a few hours, the charity certifies that they did it, and the person claims money from the government.

The exception here is if the product you donated is something you sell on a regular basis. If that's the case you might be able to claim it as a donation of goods, for the price you would normally charge - although there are probably some other hoops you need to jump through first. For that you absolutely need to tell us where you pay your taxes.

I would recommend instead spending a little time basking in the knowledge that you have contributed to the ongoing good of humanity. That's a reward they can't deny you.

What about actual costs?

Actual money you spend is a different matter. That's definitely going to need knowledge of your specific tax jurisdiction. Probably the best way to do it is to have the charity pay for those costs directly to the server providers (I'm assuming its only a few tens of dollars a month) and for you to make a monetary donation which covers it. You would get a rebate on the donation. You need to make sure there is no suspicion that any of the money you donate is coming back to you.

A completely irrelevant aside

Have you thought about what will happen if you aren't in a position to support this system any more, especially if you were to die or get sick unexpectedly? If you want the charity to keep benefitting from your work you should make sure that they have access to your code and the servers.

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    I think there is another piece to the question. It sounds like he is spending non-deductible time but also deductible dollars going to a cloud provider to host the servers themselves. If that is coming out of his pocket, it should generally be deductible.
    – Justin Cave
    Commented Apr 21, 2022 at 13:38
  • Added something about that.
    – DJClayworth
    Commented Apr 21, 2022 at 13:43
  • I pay taxes in the State of Texas but I see your point I’m not trying to make a profit I’ve actually developed lots of unpaid software that they use to ensure a lot of things function but those don’t rely on cloud servers and cloud flare to help filter hack attempts and malicious traffic and that’s where the cost comes in. I would like to provide this at cost as it is an essential service and I recognize that. But I may have to try higher up as even the it department won’t spin up an image with my code and give me access after.
    – Matt
    Commented Apr 21, 2022 at 17:11
  • I find that hard to believe - do you have any sources for that? If I develop a software and sell it to them for an amount X, and - coincidentally - decide to donate an amount X to them, that amount should be deductible. It is a piece of software that has a certain worth, not 'time spent doing something'
    – Aganju
    Commented Apr 22, 2022 at 0:21
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    As I say in the answer, if you have a product that you regularly sell for a certain amount then you have a much better chance. But otherwise it's just your guess that the software is worth that. And you can't donate an amount on condition that they give it back to you - that's not a donation.
    – DJClayworth
    Commented Apr 22, 2022 at 1:02

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