Valuation: Fair market value ("FMV") = price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts. Sec. 1.170A-1(c)(2). Contribution of Property Placed in Trust: No deduction...
Panel on the Nonprofit Sector – Final Report
The Panel on the Nonprofit Sector presented its Final Report to Senate Finance Committee Chairman Sen. Charles Grassley and Ranking Member Sen. Max Baucus on June 22, 2005. The report recommends more than 120 actions to be taken by Congress, the Internal Revenue Service and charitable organizations in order...
Percentage Limitations on the Charitable Contribution Deduction
Individual’s charitable contribution to a public charity The charitable contribution deduction (“CCD”) for a contribution of money (or ordinary income or short-term capital gain property) to a Sec. 170(b)(1)(A) organization (e.g., public charity, operating foundation, distributing foundation) is limited to 50% of the individual’s “contribution base” (defined as AGI...
Value Reduction Rules for a Contribution of Property Under IRC Sec. 170(e)(1)
General rule – the amount of the deduction is determined by the FMV of the property at the time of the contribution. Reg. Sec. 1.170A-1(c)(1). This amount is reduced by the amount of gain which would not have been long-term capital gain if such property had been sold by...
Definition of “Gift” and the Charitable Contribution Deduction
Gifts A gift is a transfer that (1) is voluntary, and (2) is motivated by a "detached and disinterested generosity." Commissioner v. Duberstein, 363 U.S. 278, 285 (1960). "Where consideration in the form of substantial privileges or benefits is received in connection with payments by patrons of fund-raising activities,...
Nonprofits Under a Microscope – June 7, 2005
Geralyne Mahoney of Burr, Pilger & Mayer LLP presented a program at the firm’s San Francisco offices on the recent federal scrutiny of nonprofit organizations and the response from the nonprofit sector. The following links serve as an outline of the discussion: Learning from Sarbanes-Oxley – A Checklist for...
“New Opportunities for Fundraising and Financial Management” – June 2, 2005
For those who attended the panel discussion on financial management hosted by Internet Securities on June 2, 2005, I thank you for your attendance and include the following supplemental information for your convenience: Best practices in financial management. We discussed having financial policies governing matters such as internal control...
Panel on the Nonprofit Sector Releases Draft Recommendations for Senate Finance Committee
The Panel on the Nonprofit Sector released the following draft recommendations for its June Report to the Senate Finance Committee: Board Compensation – greater transparency with disclosure of both services provided and the responsibilities of board members Executive Compensation – annual approval by board or authorized committee Structure, Size,...
IRS Exempt Organizations Workshop – May 10, 2005
Session 1 Tax-Exempt StatusJeopardizing 501(c)(3) Status Distinction between "tax-exempt" and "nonprofit" Major types of exempt organizations – charitable/educational/religious; public charity/private foundation; (c)(3) / (c)(4) / … Benefits of tax-exempt status – income tax exemption; possible exemption from state income, sales and property taxes; reduced postal rates offered to some...
Philanthropy Forum – May 10, 2005
The May 10, 2005 Philanthropy Forum featured guest speakers from the Council on Foundations: Janne Gallagher, Vice President and General Counsel, and Diane Canova, Vice President, Government Relations and Public Policy. The topic and a current Council initiative: Building Strong and Ethical Foundations. Ms. Gallagher opened by identifying the...