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Jack Owen’s Tax-Exempt Alert SEPTEMBER 2019

At a recent meeting of the Pittsburgh Planned Giving Council, I reported on the following newsworthy items:

1.    The bipartisan Legacy IRA Rollover Bill (H.R. 1337) was discussed. This proposed legislation will encourage charitable giving, and expand the existing IRA charitable rollover provisions, by enabling senior citizens to make tax free transfers from IRA’s to charities through life-income plans (charitable gift annuities and charitable trusts). Several items were distributed at the meeting including a sample letter to Rep. Mike Kelley, an article from the American Council on Gift Annuities and a Cummings & Lockwood LLC article (all attached).  All are encouraged to use these materials in promoting passage of H.R. 1337.

2.    Two recent cases were discussed regarding charitable substantiation. The first was Blau v. Commissioner (D.C. Court of Appeals, May 24, 2019) where the Court affirmed a Tax Court decision denying a charitable deduction of $33,000,000 because the taxpayer did not include the cost basis and date of acquisition of the donated property on IRS Form 8283.  The Court remarked that providing the cost basis is important to IRS when buying the property for approximately $3M and then claiming a charitable deduction of $33M a little more than two years later.  The second case discussed was Oliveri v. Commissioner, (Tax Court Memo, May 28, 2019). In this case, the Tax Court denied most of the taxpayer’s deductions because they were for personal, rather than charitable expenses, were not properly substantiated, and were not in coordination with or supervised by a charitable organization.  Both of these cases show the importance of strict substantiation of charitable contributions in accordance with IRS regulations.

Please do not hesitate to contact us if you have any questions on any of these topics.

We sincerely hope you appreciate receiving the information in this newsletter.  But in case you do not want to receive it, please contact Diane Trichtinger at 412.745-1040, or [email protected] to be removed from this list.  Likewise, please contact Diane with any colleagues or other persons who you would like to add to this list.  

Note:  This provides general information regarding matters of interest to tax-exempt organizations.  Such information is neither legal advice nor legal opinion concerning particular situations.  If legal advice or opinion is required, legal counsel should be consulted.  

We would be pleased to address any questions you may have regarding the foregoing or any other tax-exempt issues.  For further information, please contact Susan Ott (412-745-9900), [email protected]; or Jack Owen (412-765-1020), [email protected].

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