<petemarsocci[at]yahoo.com> wrote

- quote -

Well, it's an up hill battle, but the appraisal should
stand, as the charity probably didn't wait to get the best
offer on the property before selling it. Make sure that the
appraiser is willing to go to bat on his work and appeal
their decision to change the deduction amount.

FYI: This is why they changed the rules, so expect problems.
For the tax bite, it's worth the effort to take it on up
the legal food chain.

--
Paul Thomas, CPA
paulthomascpapc[at]bellsouth.net

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

<petemarsocci[at]yahoo.com> wrote

- quote -

Well, it's an up hill battle, but the appraisal should
stand, as the charity probably didn't wait to get the best
offer on the property before selling it. Make sure that the
appraiser is willing to go to bat on his work and appeal
their decision to change the deduction amount.

FYI: This is why they changed the rules, so expect problems.
For the tax bite, it's worth the effort to take it on up
the legal food chain.

--
Paul Thomas, CPA
paulthomascpapc[at]bellsouth.net

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

<petemarsocci[at]yahoo.com> wrote:

- quote -

True, the mandatory rules change were after 2003.

So we have here two conflicting Facts.

Fact 1: Appraisal for 395,000

Fact 2: Sale one week later for 135,000.

You did not say how long the taxpayer held the boat before
donating it, but if it was for more than one year, you might
think you can claim the appreciated value -- FMV?

Not here.

Gifts of appreciated property are limited to cost basis
unless the recipient organization uses the gift for its
charitable purposes.

I assume the denial was not due to exceeding the 30% of AGI?

(Appreciated property of not more than 30% of AGI can be
deducted with remainder carried forward.)

Assuming neither of those rules tripped anyone up, then you
have an upper and lower bound. If you appeal, your grounds
are probably along the lines that the property had not
appreciated or if it did, you limited your deduction to cost
basis, and that the sale was not what a willing buyer and
seller not under any pressure to sell would have agreed to,
but rather, the recipient just wanted to get this old boat
off its property and took the first offer that came along.

In any case, be sure to get the basis of the denial so you
can know what you are up against.

If the denial came about because the deduction was for
appreciated FMV, you are stuck, since they sold it and did
not use it for its intended charitable purpose. And if
denial was due to going over 30% of AGI, you are stuck.
But if denial came about because a law that did not apply to
2003 was being used, you should push this appeal upstairs.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

<petemarsocci[at]yahoo.com> wrote:

- quote -

True, the mandatory rules change were after 2003.

So we have here two conflicting Facts.

Fact 1: Appraisal for 395,000

Fact 2: Sale one week later for 135,000.

You did not say how long the taxpayer held the boat before
donating it, but if it was for more than one year, you might
think you can claim the appreciated value -- FMV?

Not here.

Gifts of appreciated property are limited to cost basis
unless the recipient organization uses the gift for its
charitable purposes.

I assume the denial was not due to exceeding the 30% of AGI?

(Appreciated property of not more than 30% of AGI can be
deducted with remainder carried forward.)

Assuming neither of those rules tripped anyone up, then you
have an upper and lower bound. If you appeal, your grounds
are probably along the lines that the property had not
appreciated or if it did, you limited your deduction to cost
basis, and that the sale was not what a willing buyer and
seller not under any pressure to sell would have agreed to,
but rather, the recipient just wanted to get this old boat
off its property and took the first offer that came along.

In any case, be sure to get the basis of the denial so you
can know what you are up against.

If the denial came about because the deduction was for
appreciated FMV, you are stuck, since they sold it and did
not use it for its intended charitable purpose. And if
denial was due to going over 30% of AGI, you are stuck.
But if denial came about because a law that did not apply to
2003 was being used, you should push this appeal upstairs.

__
Art Kamlet ArtKamlet [at] AOL.com Columbus OH K2PZH

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >

Tax question-

My client donated a boat on August 1, 2003. He received an
appraisal on the boat 1 week before for 395,000. After
donating the property the charity sold the boat for 135,000
on August 8, 2003. IRS has disapproved the 395,000 and says
the deduction can only be 135,000 and want 100,000 right
away. Any help regarding this issue would be greatly
appreciated. I understand the rules changed in 2004.

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >