Thursday April 25, 2024

1.5.2 Form 8283 and Appraiser Qualifications

Form 8283 and Appraiser Qualifications

Substantiation - General Rules:  Gifts of $250 or more to a charity require a receipt.

Recordkeeping and Substantiation for Cash Gifts:  Gifts of money are substantiated by a receipt from the organization or reliable written records.

IRS Form 8283, Noncash Charitable Contribution:  If a person makes a noncash charitable contribution greater than $500, he or she must include Form 8283 with his or her tax return.

Qualified Appraisal Requirements:  With several exceptions, gifts of property over $5,000 in value ($10,000 for closely-held stock) will require a qualified appraisal or the charitable deduction may be denied.

Required Form 8283 Information:  Form 8283 must include a description of the property.

Appraiser Requirements and Penalties:  There are specific requirements for the appraiser and substantial potential accuracy-related penalties.

Substantial and Gross Valuation Misstatement Penalties:  Accuracy related penalties are applicable with specific floors.

Form 8283 Appraisal Summary - Part B:  For gifts of property over $5,000 in value, ($10,000 for closely-held stock), Part B of Form 8283 must be completed.

Artwork Over $20,000 in Value:  If a deduction is claimed for a gift of artwork and the value is greater than $20,000, then the complete signed appraisal must be submitted with Form 8283.

Property Gift Over $500,000 in Value:  If the noncash gift is over $500,000 in value, then both the Form 8283 and the appraisal are required.

Form 8282 Donee Information Return:  For gifts of property over $5,000 in value, ($10,000 for closely held stock), the signer of Form 8283 must file Form 8282 if there is a disposition of the property within three years of the date of the gift.

Filing Form 8283:  Form 8283 may be filed electronically by one of two methods depending on the amount of the gift.

Substantiation - General Rules
Gifts of $250 or more to a charity require a receipt. The receipt issued by the charity must state that no goods or services have been transferred in exchange for the gift. Reg. 1.170A-13. If the donor receives a "quid pro quo" (i.e., something in return) from the charity, the deduction value is reduced by the value of the "quid pro quo." For "quid pro quo" gifts over $75, the charity must make a good faith estimate of the value of the goods or services transferred to the donor and disclose the estimate. Reg. 1.170A-13(f). For gifts to a donor advised fund, there must be a contemporaneous written acknowledgment that the charity has "exclusive legal control" over the DAF assets. Sec. 170(f)(18)(B).

Records and substantiation are important. Taxpayers consistently are denied charitable deductions when the requested substantiation is not available. In addition, the taxpayer must receive the receipt from the charity prior to filing his or her tax return.

Recordkeeping and Substantiation for Cash Gifts
Gifts of money are substantiated by a receipt from the organization or reliable written records. Gifts of $250 or more also require a "contemporaneous written acknowledgement" from the charity, typically a receipt. Cash gifts of any amount are deductible only if there are reliable written records. The reliable record must be a bank record or a receipt from the charity specifying the amount and date of the contribution. Sec. 170(f)(17).

IRS Form 8283, Noncash Charitable Contribution
If a person makes a noncash charitable contribution greater than $500, he or she must include Form 8283 with his or her tax return. The first section of Form 8283 includes Part A, a description of the property. If the property is publicly traded stock or if the stock is closely held business stock worth less than $10,000, only Part A is required. Reg. 1.170A-13(c). For carryforwards of noncash charitable contributions, the donor must include a completed Form 8283 and qualified appraisal, if required, to the tax return claiming the carryforward.

Qualified Appraisal Requirements
With several exceptions, gifts of property over $5,000 in value ($10,000 for closely-held stock) will require a qualified appraisal or the charitable deduction may be denied. Reg. 1.170A-13(c). Qualified appraisal exceptions include stock traded on a public exchange, inventory and vehicles sold by the donee without significant intervening use or material improvement. Sec. 170(f)(11)(A)(ii).

The appraisal must be made not earlier than 60 days prior to the gift and not later than the date the return is due (with extensions). The qualified appraisal requirement applies to individual taxpayers, partnerships and corporations.

For gifts of art valued at over $20,000 or if the noncash gift deduction exceeds $500,000, the appraisal must be appended to the return. Sec. 170(f)(11)(D). If the appraised property is a home in an historic district, the appraisal must include photos of the four sides of the home, a $500 fee and an agreement with a qualified conservation charity. The historic easement appraisal must be submitted with the tax return. The agreement states under oath that the conservation charity is qualified to receive the easement and has the resources and commitment to enforce the agreement. Sec. 170(h)(4)(B)(ii). If a donor gives personal property "not in good used condition," valued over $500, an appraisal must also be appended to the tax return.

A qualified appraisal must contain a sufficiently detailed description of the property, taking into account the value of the property, so that a person not "generally familiar" with the type of property could ascertain that the appraised property is the contributed property. Reg. 1.170A-17(a)(3)(i)(A). If the appraised property is real estate or tangible personal property, the qualified appraisal must describe the condition of the property. Reg. 1.170A-17(a)(3)(i)(B).

If the property donated to charity is a partial interest, the qualified appraisal must be of the partial interest. Reg. 1.170A-17(a)(12). If a donor wishes to fund a charitable remainder trust with real estate, the entire property must be appraised when the entire property is donated. The deduction factors will be applied to the full fair market value of the property to calculate the donor's charitable contribution value. On the other hand, if a donor wishes to donate only a 10% undivided interest in the remainder of a property, the qualified appraisal must be of the contributed portion. Namely, the qualified appraisal would value the 10% undivided interest in the reminder of the property. Rev. Rul.87-37.

Qualified appraisals may be obtained prior to or even after the property is contributed to charity. The qualified appraisal must state the valuation effective date, which may differ from the date of the appraisal. Reg. 1.170A-17(a)(3)(i)(C). Note that for purposes of substantiating the deduction, the appraisal must be made not earlier than 60 days prior to the gift and not later than the date the return is due (with extensions).

Qualified appraisals must determine the fair market value of the contributed property on the valuation effective date. Reg. 1.170A-17(a)(3)(i)(D). The fair market value is "the price at which the property would change hands between a willing buyer and a willing seller." Reg. 1.170A-1(c)(2).

Required Form 8283 Information
Form 8283 must include a description of the property. For tangible personal property, this description should include the general condition of the property. Any restrictions or reservations of income, voting rights, acquisition rights or limits on use should be disclosed. For example, all charitable remainder trust interests must be disclosed. One method of disclosure is to append a deduction calculation to IRS Form 8283. Reg. 1.170A-13(c)(3).

The Service requires information about the appraiser to be included in the qualified appraisal. The name, address and taxpayer identification number of the appraiser must be included. Reg. 1.170A-17(a)(3)(iv)(A). The appraiser is not required to use his or her social security number, because that raises privacy and identity theft concerns. An appraiser may obtain an employer identification number (EIN) from the Service to comply with the taxpayer identification number requirements.

The appraiser's qualifications regarding the type of property being valued must be included in the qualified appraisal. Reg. 1.170A-17(a)(3)(iv)(B). This must include the appraiser's relevant education and experience. Reg. 1.170A-17(a)(3)(iv)(B).

The appraiser must disclose if he or she is acting in the capacity as a partner of a partnership, an employee of any person or as an independent contractor engaged by someone other than the donor. Reg. 1.170A-17(a)(3)(iv)(C). If the appraiser is acting in one of the above named capacities, the name, address and taxpayer identification number of the partnership or person employing the appraiser must be listed. Reg. 1.170A-17(a)(3)(iv)(C). A person engaging the services of the appraiser may be an individual, corporation or partnership.

The appraisal must include the signature of the appraiser and the appraisal report date. Reg. 1.170A-17(a)(3)(v). The appraisal must state that it was prepared for "income tax purposes." Reg. 1.170A-17(a)(3)(vii). If an appraisal is lacking any required information, the entire charitable deduction may be disallowed. The final regulations do not include exceptions for reasonable cause or substantial compliance. Thus, it is important for the appraisal to include all of the required information. The appraisal must include a specific declaration from the appraiser, found in Reg. 1.170A-17(a)(3)(vi).

Appraiser Requirements and Penalties
There are specific requirements for the appraiser and substantial potential accuracy-related penalties. The appraiser will be qualified if he or she has an appraisal designation from a recognized organization, has otherwise met comparable education experience requirements, regularly performs and is paid for appraisals, has verifiable education and experience with the type of property appraised, has not been prohibited from practicing before the IRS and has not been excluded by Treasury regulations from serving as an appraiser. Sec. 170(f)(11)(E)(ii).

A "qualified appraiser" is defined in Reg. 1.170A-17(b)(1) as an individual with "verifiable education and experience in valuing the type of property for which the appraisal is performed." The education and experience requirements may be met one of two ways. First, the appraiser may satisfy the requirement by successfully completing college-level or professional-level coursework in valuing the type of property being appraised and having two or more years of experience valuing that type of property. Reg. 1.170A-17(b)(2)(i)(A). Under Reg. 1.170A-17(b)(2)(ii), the coursework must be obtained from one of three sources: a professional or college-level educational organization, a generally recognized trade or appraiser organization or an employee apprenticeship or educational program similar to the educational options above.

Alternatively, the appraiser may satisfy the education and experience requirement by earning a "recognized appraiser designation" for the type of property to be valued. Reg. 1.170A-17(b)(2)(i)(B). This designation must be obtained from a generally recognized professional appraiser organization and the individual must earn the designation through demonstrated competency. Reg. 1.170A-17(b)(2)(iii).

The regulations define "type of property" as "the category of property customary in the appraisal field for an appraiser to value." Reg. 1.170A-17(b)(3). Therefore, it is important to not only meet the education and experience requirements, but those requirements must be met specifically for the type of asset that is being valued. In other words, a qualified appraiser of real estate is not necessarily qualified to appraise life insurance. The appraiser must meet the requirements for each type of property in order to be recognized as a qualified appraiser of that type of asset.

The term "qualified appraisal" is defined as an appraisal "prepared by a qualified appraiser in accordance with generally accepted appraisal standards." Reg. 1.170A-17(a)(1). The Treasury Regulations define generally accepted appraisal standards as "the substance and principles of the Uniform Standards of Professional Appraisal Practice, as developed by the Appraisal Standards Board of the Appraisal Foundation." Reg. 1.170A-17(a)(2).

For real property gifts, the appraiser meets the required standards if he or she is licensed or certified for the type of real property by the appropriate state agency. Some state agencies have a separate certification for residential real estate and other types of real estate such as commercial real estate. In these states the appraiser must have the appropriate designation for the type of real estate gifted to charity. Notice 2006-96; 2006-46 IRB 1.

The appraisal must include a specific declaration from the appraiser, found in Reg. 1.170A-17(a)(3)(vi), which reads as follows: "I understand that my appraisal will be used in connection with a return or claim for refund. I also understand that, if there is a substantial or gross valuation misstatement of the value of the property claimed on the return or claim for refund that is based on my appraisal, I may be subject to a penalty under section 6695A of the Internal Revenue Code, as well as other applicable penalties. I affirm that I have not been at any time in the three-year period ending on the date of the appraisal barred from presenting evidence or testimony before the Department of the Treasury or the Internal Revenue Service pursuant to 31 U.S.C. 330(c)." . The appraiser penalties for incorrect appraisals are the greater of $1,000 or 10% of the understatement from a substantial or gross valuation misstatement, with a cap of 125% of the appraiser's gross income from the appraisal. Sec. 6695A(b). The IRS may also discipline appraisers after notice and a hearing. Disciplinary action may include suspending or barring an appraiser from preparing or presenting appraisals to the IRS.

Excluded Individuals
The Service expressly states that certain categories of individuals are "not qualified appraisers." Reg. 1.170A-17(b)(5).

Prohibited Fee
If an individual charges an appraisal fee that is "based to any extent" on the appraised item's value, the individual is not a qualified appraiser. Reg. 1.170A-17(b)(5)(i). The Service does not allow the donor or the donee to act as a qualified appraiser. Reg. 1.170A-17(b)(5)(ii). Reg. 1.170A-17(b)(5)(iv).

Party to the Acquisition
If the appraiser is a party to the donor's acquisition of the item, the item must be contributed within two months of its acquisition and the appraised value must not exceed the acquisition price paid. If the item is not contributed to charity within two months or the appraised value exceeds the acquisition cost, the appraiser will not be considered a qualified appraiser. The Service defines a party to the transaction as an individual who sold, exchanged or gifted the item; or any individual who acted "as an agent" for the transferring individual or the donor in the sale, exchange or gift transaction. Reg. 1.170A-17(b)(5)(iii).

Related Individuals
Individuals who are related to or an employee of the donor, a party to the transaction or the donee are not considered qualified appraisers. Reg. 1.170A-17(b)(5)(v)(A). If the individual is married to a relative or an employee of the donor, a party to the transaction or the donee, he or she will not be considered a qualified appraiser. Reg. 1.170A-17(b)(5)(v)(B).

The definition of "related to" is found in Sec. 267(b) and includes a long list of potential relationships between the parties. A few of the defined relationships are as follows: siblings, spouse, ancestors, lineal descendants and any individual and corporation owned by such individual that owns more than half the value of the outstanding stock, directly or indirectly. Sec. 267(b)(1), (2).

Majority of Appraisals
If an individual is an independent contractor who is "regularly used" for appraisal purposes by the donor, a party to the transaction or the donee and does not perform a majority of appraisals for individuals other than the donor, he or she will not be considered a qualified appraiser. Reg. 1.170A-17(b)(5)(v)(C). For a cautionary tale, see James Tarpey v. United States; No. 2:17-cv-00094 (2019).

Prohibited by IRS
If, at any time during the three-year period ending on the appraisal signature date, an individual was prohibited from practicing before the Service under 31 U.S.C. Sec. 330(c), he or she will not be considered a qualified appraiser. Reg. 1.170A-17(b)(5)(vi).

Substantial and Gross Valuation Misstatement Penalties
Accuracy related penalties are applicable with specific floors. The substantial valuation misstatement floor is 150%. Sec. 6662(e)(1). The penalty for a substantial valuation misstatement is 20% of the underpayment. A gross valuation misstatement is 200% of correct value. Sec. 6662(h)(2). The penalty on a gross valuation misstatement is 40% of the underpayment. There is an exception for underpayments of $5,000 or less and a reasonable cause exception to the accuracy-related penalty for substantial valuation misstatements, but it does not apply in the case of gross valuation misstatements.

Form 8283 Appraisal Summary - Part B
For gifts of property over $5,000 in value, ($10,000 for closely-held stock), Part B of Form 8283 must be completed. In addition, both the appraiser and the charitable donee must sign Form 8283. With a charitable remainder unitrust or annuity trust, there may not be a vested charitable donee as remainder recipient. Therefore, for all unitrusts or annuity trusts, the trustee must sign in place of the charitable donee.

The signature of the donee is merely to acknowledge that the donee has received the property. Furthermore, when the donee signs Form 8283, it incurs an obligation to file Form 8282 within 125 days of sale of the asset, if that sale date is within three years of the date of the gift.

Due to the requirements of Form 8283, if a contributed property valued over $5,000 is disposed of within three years of the date of the gift, the charity is required to report that disposition to the Service on Form 8282. The reporting on Form 8282 may require the donor to reconsider the reported value of his or her charitable deduction. In some cases, the Service may challenge the value of the charitable deduction if the Form 8282 value is vastly different from the claimed deduction amount.

Therefore, if the donor and charity have entered an agreement or understanding that relates to the use, sale or other disposition of the contributed property, it must be disclosed in the qualified appraisal. Reg. 1.170A-17(a)(3)(ii). Qualified appraisals must list restrictions to the charity?s right to use or dispose of the contributed property, even if it is a temporary restriction. Reg. 1.170A-17(a)(3)(ii)(A).

If the charity does not have the full power and authority to designate the recipient of the contributed property?s income, possession or rights to acquire, this must be disclosed in the qualified appraisal. Reg. 1.170A-17(a)(3)(ii)(B). This includes whether or not the right to vote contributed securities is fully vested in the charity. Reg. 1.170A-17(a)(3)(ii)(B). Earmarks or designations for a particular use must also be disclosed in qualified appraisals. Reg. 1.170A-17(a)(3)(ii)(C). The appraisal must also list the expected date of the contribution. Reg. 1.170A-17(a)(3)(iii).

Charitable Gift Appraisal Checklist

Many gifts of property over $5,000 in value ($10,000 for closely-held stock) require a qualified appraisal or the charitable deduction may be denied. Reg. 1.170A-13(c). Qualified appraisal exceptions include stock traded on a public exchange, inventory and vehicles sold by the donee without significant intervening use or material improvement. Sec. 170(f)(11)(A)(ii). This checklist is not legal or accounting advice. It is a helpful summary of IRS appraisal and appraiser requirements. For a comprehensive explanation of appraisal requirements, see Reg. 1.170A-13(c)(3) and IRC Sec. 170(f)(11).

Qualified Appraisal Requirements

____ 1. Timely - A qualified appraisal window is from 60 days prior to the date of contribution until the due date for the tax return (with extensions). The appraisal made after the gift will be a valuation as of the gift date. The donor must receive the appraisal prior to filing his or her tax return.

____ 2. Date and Purpose of Appraisal - The appraisal must state the date of the gift, the date the appraisal was completed and that it was done for federal income tax purposes.

____ 3. Qualification - The appraisal must comply with the requirements for content and must be completed by a qualified appraiser.

____ 4. Appraiser Qualifications - The appraiser's specific qualifications, name, address, taxpayer identification number (EIN) and (if applicable) the appraiser's employer name, address and federal I.D. number must be included.

____ 5. Permissible Fee - Generally, the fee may not be a percentage of the appraised value of the property.

____ 6. Property Description - The description must be sufficiently detailed that it appropriately describes the property and enables third-party identification of the gifted property.

____ 7. Tangible Personal Property - If the asset is tangible personal property, the appraisal must describe the physical condition of the property.

____ 8. Agreement - The appraisal must detail the specific terms of the gift, including any provisions for use, sale or reversion of the property to donor or donor's family.

____ 9. Fair Market Value - The appraised fair market value must be clearly stated.

____ 10. Method and Basis - The appraisal method used to determine value and the basis or assumptions appropriate for that method must be fully described.

Qualified Appraiser Checklist

____ 1. Appraiser Background - The appraiser must have either a designation from a recognized appraisal organization or meet the applicable minimum education and experience requirements.

____ 2. Real Property - An appraiser must have a license or certification from a recognized appraisal organization in the state in which the real property is located.

____ 3. Other Property - For tangible personal property or non-real estate assets, the appraiser must have relevant college or professional coursework and at least two years of experience in valuing the property described. The appraisal document must fully describe the education and experience that provides such qualification.

____ 4. Regular Public Appraisals - The appraiser must show that he or she is available to the public for the purpose of making appraisals.

____ 5. Prohibited Appraisers - The appraisal may not be completed by an appraiser who has been prohibited from doing so by the IRS, by the donor, by a party to the transaction, by the charity, by an employee of any of the above or by an individual who is not objective.

____ 6. Potential Appraiser Penalties - The appraiser must acknowledge that he or she understands the potential penalties under IRC Sec. 6695A for a substantial or gross valuation misstatement.


Artwork Over $20,000 in Value
Gifts of artwork are also subject to unique substantiation requirements. If a donor who is not the creator of the art wishes to claim a deduction for a gift of art, and the value is greater than $20,000, the donor must submit a complete signed appraisal with Form 8283. In addition, the donor must provide either an 8" by 10" color photo or a 4" by 5" color transparency of the art. Instructions for Form 8283. As is the general rule with noncash gifts valued at more than $5,000, a qualified appraisal is required.

Property Gift Over $500,000 in Value
If a donor makes a charitable contribution valued at over $500,000, he or she will be required to attach additional substantiation to claim a charitable deduction. The donor must obtain a contemporaneous written acknowledgement and a qualified appraisal prepared by a qualified appraiser. Reg. 1.170A-16(e)(1). A completed Form 8283 must be filed with the return on which the deduction is claimed. In addition, the donor must attach the qualified appraisal to the tax return on which the deduction is claimed. Reg. 1.170A-16(e)(1)(iv).

The same exceptions for noncash gifts valued over $5,000 apply to noncash gifts over $500,000. A qualified appraisal is not required for gifts of publicly traded securities, certain intellectual property, qualified vehicles and certain inventory-type assets. Reg. 1.170A-16(e)(2). Form 8283, Section B does not need to be completed for this type of property gift. The donor will, however, be required to complete Form 8283, Section A. Reg. 1.170A-16(e)(2).

Form 8282 Donee Information Return
For gifts of property over $5,000 in value, ($10,000 for closely held stock), the signer of Form 8283 must file Form 8282 if there is a disposition of the property within three years of the date of the gift. Sec. 6050L. A disposition is defined as the sale, consumption or gift of the "charitable deduction property." Reg. 1.6050L-1(c). There are exceptions for the sale of items up to $500 in which the donor signs a statement so indicating, and for consumption of the gift property for the exempt purpose of the charity.

A failure to file Form 8282 may subject the charity to a penalty of $50 per offense, up to a total of $250,000. Sec. 6721(a). However, if the failure is intentional, the penalty is increased to $100, with no total limit. Sec. 6722(c).

Filing Form 8283
Form 8283 may be filed electronically by one of two methods depending on the amount of the gift. If the gift is less than $5,000 or if the gift is of publicly traded securities of any amount and no signature is required on page 2 of Form 8283, the donor may execute an electronic signature with a Form 8879 (IRS e-file Signature Authorization). If this method is used, nothing further must be sent to the IRS.

The second method is used when the gift is over $5,000 or a signature is required on page 2 of Form 8283. In this instance, the donor can file Form 8283 electronically by executing Form 8453. However, Form 8453 (Individual Income Tax Declaration for an IRS e-file Return) must be mailed within three days of receiving acknowledgement that the IRS has accepted the electronically filed return. The donor must also attach a completed and signed Form 8283 when using this method of electronic filing.

Case Studies on Form 8283 and Appraiser Qualifications

Get a Life (Insurance Policy) and Give it Away:   Dr. Eleanor Crane, 55, has been director of research at a local hospital for the past 16 years. She is the first woman director in the hospital's history and was honored several times by her colleagues for outstanding medical research. During her tenure as director, she and her spouse, August, raised two wonderful daughters, Denise and Laura. In fact, both of her daughters are medical students and wish to follow in the prestigious steps of Dr. Crane (a.k.a. Mom).

Exit Strategies for Real Estate Investors, Part 11:   Karl Hendricks was a man with the golden touch. Throughout his life, it seemed every investment idea that he touched turned to gold. Karl's passion was real estate, and he was very successful in his investments.

Exit Strategies for Real Estate Investors, Part 12:   Karl Hendricks was a man with the golden touch. Throughout his life, it seemed every investment idea that he touched turned to gold. Karl's passion was real estate, and he was very successful in his investments.

Exit Strategies for Real Estate Investors, Part 13:   Karl Hendricks was a man with the golden touch. Throughout his life, it seemed every investment idea that he touched turned to gold. Karl's passion was real estate, and he was very successful in his investments.

Sam Storeowner and the Tax-Free Buyout:   Sam Storeowner was having coffee at Small Town Café when his friend Bob Banker walked into the café. Bob motioned Sam to a booth in the back and said that he wanted to talk to Sam. It turns out that Bob and several friends were in the process of obtaining a charter for a new bank. They were contacting a number of business owners in town and offering them the opportunity to invest.

Related Topics on Form 8283 and Appraiser Qualifications

1.5.1  Fair Market Value:    Property is bought and sold every day between willing buyers and willing sellers. The determination of value for any charitable gift is simple. It is merely the value that a willing buyer would pay a willing seller. However, the specific rules for determining value can vary considerably. Cash is, of course, worth its face value and public securities can be valued by their worth on an exchange, but other assets are more difficult to value. Thus, there are specific rules for valuing stocks, real estate, mutual funds, life insurance, art and other types of property. Reg. 20.2031-1(b).

1.5.3  Valuation Discounts:    There are several types of gifts in which a donor may give less than the entire value of an asset or business entity. If the gift is publicly traded stock - such as 100 shares of IBM - then the deduction is permitted at fair market value. However, for other types of properties, such as gifts of a family C corporation, a limited liability company, a family limited partnership or fractional interests in real estate, there may be a discount in value. For gift tax purposes, this discount is desired, but for charitable deduction purposes, a discount will reduce income tax savings.

1.6.1  Gift Substantiation:    Gifts of money are substantiated by a receipt from the organization or reliable written records. Gifts of $250 or more also require a "contemporaneous written acknowledgement" from the charity, typically a receipt.

Ney:    In Bruce K. Ney et ux. v. Commissioner; T.C. Summ. Op. 2006-154; No. 10257-05S (19 Sep 2006), donors Bruce and Marina Ney contended that they should receive a charitable deduction for a bargain sale of real property to a conservation charity, even though they did not comply in a timely manner with the appraisal requirements.

Smith:    In Rhett Rance Smith et ux. et al. v. Commissioner; T.C. Memo. 2007-368; Nos. 11902-05, 13225-05, 13226-05, 13227-05, 13228-05 (17 Dec. 2007), the tax court disallowed charitable deductions for gifts of family limited partnerships interests.

Astleford:    Jean Z. Astleford is a surviving spouse. Her husband M. G. Astleford was a real estate investor. In 1970, he and a partner each acquired a 50% interest in Pine Bend Development Co. and purchased 3,000 acres of land near St. Paul, Minnesota.

Tucker:    In Paul L. Tucker Jr. et ux. v. Commissioner; T.C. Summ. Op. 2008-78; No. 5854-06S (2 Jul 2008), the taxpayers had claimed business deductions and charitable deductions. Mr. Tucker is a pilot for Southwest Airlines and resides in Birmingham, Alabama. His principal position with Southwest is as a line captain and check pilot at Midway Airport. He deducted $28,536 for employee expenses and $19,979 for charitable gifts for tax year 2002.

Bergquist:    In Bradley J. Bergquist et al. v. Commissioner; 131 T.C. No. 2; Nos. 17530-06, 17535-06, 17537-06, 17541-06, 17545-06, 17549-06 (22 Jul 2008), the tax court rejected an inflated appraisal on a charitable gift of stock and assessed back taxes and substantial penalties.

Gomez:    In Daniel Gomez et ux. v. Commissioner; T.C. Summ. Op. 2008-93: No. 13167-07S (30 Jul 2008), the taxpayers were members of the Apostolic Assembly, a church body. During 2005, they tithed to the Assembly and gave $6,548.27. Their total charitable deductions claimed on their 2005 IRS form 1040 were $6,885.

Nicholas:    In Donald W. Nicholas et ux. v. Commissioner; T.C. Summ. p. 2008-155; No. 18199-07S (15 Dec 2008), the tax court permitted a deduction for a noncash charitable contribution.

Crimi:    In John Crimi et al. v. Commissioner; T.C. Memo. 2013-51; Nos. 13252-09, 13262-09, 20519-09, 22374-09, 22417-09, 22531-09, (13 Feb 2013), Tax Court Judge Laro determined that a sale below fair market value qualified for a charitable deduction. While the appraisal was not attached to IRS Form 1040, the deduction was permitted under the "reasonable cause" exception of Sec. 170(f)(11).

Friedberg:    In Barry S. Friedberg et ux. v. Commissioner; T.C. Memo. 2013-224; No. 9530-09 (22 Sep 2013), the Tax Court considered a change of law and determined that a previous decision rejecting a façade easement appraisal because it used a percentage reduction should be changed. While the 11% reduction in value method is not permissible, there was sufficient specific basis for the appraisal.

Alli:    In Ben Alli et ux. v. Commissioner; T.C. Memo. 2014-15; No. 24863-11 (27 Jan 2014), the Tax Court denied a deduction for the gift of a Detroit apartment building to the Volunteers of America in Michigan.

Richmond:    In Estate of Helen P. Richmond et al. v. Commissioner; T.C. Memo. 2014-26; No. 21448-09 (10 Feb 2014), the Tax Court valued a 23.44% share of a family personal holding company (PHC).

Todd:    In John C. Todd, et ux. v. Commissioner; 118 T.C. No. 19; No. 17046-99 (19 Apr 2002), the Tax Court denied a fair market value charitable deduction for a gift of stock valued at $553,847.

Grainger:    In Grainger, Estelle C. v. Commissioner; No. 27817-16; T.C. Memo 2018-117 (30 Jul 2018), the Tax Court denied deductions for a "personal tax shelter" through gifts of clothing.

Tarpey:    In James Tarpey v. United States; No. 2:17-cv-00094 (2019), the U.S. District Court for the District of Montana, Butte Division, held James Tarpey subject to a Sec. 6700(a) penalty for false appraisals of timeshare donations.


Kohler:    In Herbert V. Kohler, Jr. et al. v. Commissioner; T. C. Memo. 2006 152; Nos. 4621-03, 4622-03, 4646-03, 4649-03, (25 Jul 2006), the Tax Court accepted the valuation of the taxpayer's expert appraiser.

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