Paul L. Caron

Friday, May 18, 2012

Tax Court: TP Can't Deduct $23k Contribution to Church That Failed to Include No Property/Service Statement in Acknowledgment

Tax Court Logo 2The Tax Court yesterday again reiterated that a taxpayer cannot deduct a charitable contribution without complying with the § 170(f)(8)(A) substantiation requirements. Durden v. Commissioner, T.C. Memo. 2012-140 (May 17, 2012).

Mr. & Mrs. Durden contributed $22,517 to their church in 2007. Although the church provided them with a timely statement acknoweldging the $22,517 contribution, it did not state whether they had received any goods or services as required by § 170(f)(8)(A) (the “first acknowledgment”). After being notified by the IRS of this deficiency, the Durdens obtained another statement from the church acknowledging the $22,517 contribution and stating that they received no goods or services (the “second acknowedgment”)..

The Tax Court accepted the IRS’s position that both acknowledgments failed § 170(f)(8)(A): (1) the first acknowledgment did not include the required goods or services statement; and (2) the second acknowledgment was not contemporaneous within the meaning of Reg. § 1.170A-13(f)(2) because it was not received by the Durdens before they filed their 2007 return. The Durdens conceded that they did not strictly comply with the statute, and the Tax Court rejected their attempt to prove substantial compliance.

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wow...what a reward for middle class taxpayers trying to do good in their community.

Posted by: NOLA | May 18, 2012 2:14:30 PM

Is the IRS seriously arguing that and the TC buying that argument.
This is ridiculous.
No goods and services were provided and was a proper donation.

Posted by: m fox | May 18, 2012 2:56:06 PM

Wow. An unjust result. Stand by for the statutory revision in 3... 2... 1...

Congress should change this to work the way cures of faulty Subchapter S elections work. The taxpayer should get some time after the defect in the acknowledgment is pointed out.

Posted by: Jack Bogdanski | May 19, 2012 12:35:13 AM