Stuart A. Bronstein wrote:
- quote -

WRONG. IRC 170(c): "... to or for the use of ..."

"for the use of" means that the charity receives a benefit.

Note that the language in 170(f)(8) OMITS the "for the use
of" language from the acknowlegment statement but the Tax
Court decided otherwise, still requiring ack. (even if "out
of pocket" incidentals exceed $250/YEAR; not per
transaction).

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- quote -

Good point, but I understood the orig post to say that the
charity retained title to the horse, so maintenance costs
benefit the charity, as that care is their exempt purpose.
Like claiming direct costs you incur to maintain the
landscaping around the church for them. However, if they
permit possession of the horse with no real restrictions
imposed, until the animal passes, then the paperwork seems
really a facade to give horses to people who might otherwise
buy them. If like they say that "possession is 9/10ths of
ownership under the law," maybe a deduction for 10%? :-)

Fred F.

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"Paul A Thomas" <taxman[at]negia.net> wrote:
- quote -

You know, I do some animal rescue work, and I have to
respectfully disagree with Paul. I'm pretty sure the IRS
would look at the spirit of the document and maintain that
these people did own a horse, for tax purposes.

If they were fostering the animal, that would be one thing,
but they're apparently not.

Assuming the original posters paid for the horse, ride the
horse, vet it, etc etc etc. The rescue agencies aren't
looking for another permanent home for this animal. It has
one now. It is not unusual for the documents to contain
items like home inspection clauses, and an agreement that if
the animal needs rehomed, it must be returned to the agency.
The retention of ownership is intended to protect the rights
of the agency if they should drive by and see the horse
being mistreated.

Making every dog and cat that gets adopted from a rescue
shelter tax deductible is something I just don't think
Washington is going to go for.

A

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"ken poulin" wrote:

- quote -

Such activity is a legitimate 501(c)(3) exempt purpose, and
your incurring costs to subsidize care of the animal is
ostensibly OK. One of my clients is a (c)(3) cat rescue
service, but such an arrangement would be frivolous; cats
are placed out free and clear. In my view, a cat or dog is
more a pure companion animal than a horse, which is
pleasurable for riding, and like even providing such
pleasure to say one's daughter.

Thus, what you're receiving is the benefits of ownership of
an animal you would otherwise might choose to buy for
significant cost, verses nominal cost of adoption of a cat
or dog. So, I side with your accountant. Contributions are
reduced for the value of what you receive. There may be
other experts here, but it seems that if the charity engages
in this in a substantial way, it's even questionable that
this is an acceptable way for them to foster their exempt
purpose to receive IRS approval as a (c)(3). This is
because of the restriction on "private inurement," namely
the benefit you receive.

Fred F.

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"Paul A Thomas" <taxman[at]negia.net> wrote:
- quote -

I thought to be deductible a payment must be made to the
charity, not merely for the benefit of the charity.

Stu

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ken poulin wrote:

- quote -

I'll have to agree with your accountant, absent any other
information.

Just because a "legitimate charity" is listed with the
United Way, does not mean it IS a charity recognzied by the
Department of Treasury.

To be sure then, you, or your accountant if you show him
this, should check IRS publication 78 for information on
whether or not said "charity" is indeed "legitimate".

ChEAr$$$,
Harlan Lunsford, EA n LA
11 Apr 2005
4 days and counting...... down.....\

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ken poulin wrote:

- quote -

To substantiate your reasoning, ask the charity to send you
a receipt for the "support" items. Otherwise it is hard to
proove your case.

Do you own other horses? How would you determine the
allocation for this particular horse? Do you ride the horse
and thereby benefit from possession?

I think your accountant gave you good advise.

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"ken poulin" <poulinkj[at]yahoo.com> wrote

- quote -

I think I would agree with you. It sounds like a charity
expense. Just document it well, AND get a letter from the
agency.

- quote -

--
Paul A. Thomas, CPA
Athens, Georgia
taxman at negia.net

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We took in a horse from a horse rescue. They are a
legitimate charity listed with United Way. We never received
a bill of sale for the horse. What we did receive was an
"Agreement of Possession". This agreement states that we do
not own the horse, that the rescue still does.

I asked my accountant if we could deduct our expenses for
the horse. He said no. I disagree. My reasoning is since we
are using our money to support something that still belongs
to the charity we are in effect making a donation to the
charity.

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