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medical expense, but are personal expenses of the taxpayer. Modified by Rev. Rul. 60-255 to remove the conclusion that no part of the medical expenses connected with the adoption are deductible. (Sec. 262, ’86 Code.) Rev. Rul. 56-401, 1956-2 C.B. 169. 80.5 Aerial rights given to a charitable foundation. Taxpayers gave to a charitable foundation the rights of access and support as well as the perpetual right to build, own, and maintain five additional stories on their two-story building which was susceptible to such expansion without any changes to structure or foundation.Held, the rights and interests conveyed constituted property the value of which was deductible as a charitable contribution. (Sec. 23(o), ’39 Code; Sec. 170, ’86 Code,) R. W. Fair, 27 T.C. 866, Acq., 1957-2 C.B. 4. 80.6 Airline discount coupons. In 1979, an individual purchased several full price airline tick- ets and received a discount coupon for each ticket entitling the holder to purchase, at half the nondis- counted adult fare, one ticket for travel by one per- son on the same airline. Later in the year the indi- vidual donated the coupons to a charitable organization. The amount of the contribution is subject to the reduction provisions of section 170(e) and no deduction is allowable. §1.170A-4. (Sec. 170, ’86 Code.) Rev. Rul. 79-431, 1979–2 C.B. 108. 80.7 Annuity part of split insurance program. Under a split life insurance program, the owner of an annuity contract who exercised an option under it to purchase term life insurance at discount rates and then transferred all ownership rights to the annuity, including term life renewal, to an exempt charitable organization and made annual cash con- tributions equal to the annuity premium in exchange for permission to renew the term life policy does not have an allowable deduction. §1.170A-1. (Sec. 170, ’86 Code.) Rev. Rul. 761, 1976–1 C.B. 57. 80.8 Annuity purchased from exempt orga- nization. The amount paid a charitable organiza- tion by a taxpayer for an annuity to be paid him, his wife, and the survivor, is the purchase of an annu- ity resulting in neither a gain nor a loss to the tax- Charitable contributions payers. The amount paid is regarded as consider- (See also: Carrybacks and carryovers) ation paid for it, since the present value of the annuity is in excess of the amount paid; therefor, 80.1 Additional amount paid on utility bills no charitable deduction is allowed. for emergency program. Utility customers, who §39.22(b)(2)-2. (Sec. 22(b), ’39 Code; Sec. 170, pay additional amounts on their utility bills to a ’86 Code.) utility company acting as agent for a charitable Rev. Rul. 55–388, 1955-1 C.B. 233. organization that assists individuals with emer- gency energy needs, are entitled to a charitable 80.9 Annuity purchased in excess of fair mar- deduction for the additional amount in the year ket value. The amount in excess of fair market paid. §170A-1. (Sec. 170, ’86 Code.) value of an annuity contract purchased from an Rev. Rul. 85–184, 1985–2 C.B. 84. organization described in section 170(c) may not be treated as an “investment in the contract” for 80.2 Admission cost or other participation in computing the allowable exclusion from gross fund-raising events. Guidelines are provided income of annuity proceeds, however, such regarding the deductibility, as charitable contribu- amount may be deducted as a charitable contribu- tions, of payments made by taxpayers for admis- tion. §§1.72–6, 1.170-2. (Secs. 72, 170; ’86 sion to or other participation in fund-raising activi- Code.) ties for charity. Distinguished by Rev. Rul. Rev. Rul. 70-15, 1970-l C.B. 20. 74-348. §1.170-1. (Sec. 170, ’86 Code.) Rev. Rul. 67-246, 1967-2 C.B. 104. 80.10 Annuity purchased; payment return- able. The amount paid in excess of the value of an 80.3 Admission costs and meals; volunteer annuity purchased from a charitable organization workers for underprivileged. Unreimbursed is not allowable as a charitable contribution where out-of-pocket expenses such as admission costs the taxpayer has the power to terminate the agree- and meals incurred by volunteers for underprivi- ment and require repayment of the entire amount leged juveniles who are selected by a charitable paid for the annuity at any time prior to the annuity organization are deductible as a charitable con- commencement date. §1.170A-1. (Sec. 170, ’86 tribution. The portion attributable to similar Code.) expenses of the volunteer is not deductible. Rev. Rul. 73–1, 1973-1 C.B. 117. §1.170-1. (Sec. 170, ’86 Code.) Rev. Rul. 70-519, 1970-2 C.B. 62. 80.11 Appraisal fee; donated property. An appraisal fee paid by a donor to determine the fair 80.4 Adoption expenses. Expenses incurred in market value of property which he contributed to connection with the adoption of a child are not a qualified exempt organization is deductible deductible as a charitable contribution nor as a under section 212(3) as an expense paid in connec- Charitable contributions tion with the determination of his income tax 80.19 Association of educational institutions. §§1.170A-1, 1.1031(a)-1. (Secs. 170, 1031; ’86 liability. §§1.170-1, 1.212-1. (Secs. 170, 212; ’86 Contributions to an association of educational Code.) Code.) institutions constitute gifts to such educational Rev. Rul. 76-253, 1976-2 C.B. 51. Rev. Rul. 67-461, 1967-2 C.B. 125. institutions, qualified for the maximum charitable contributions deduction, even though the con- 80.27 Bargain sale; stock pledged by corpo- 80.12 Appreciated property; tax preference. tributions received by the association in a calendar ration. A corporation that pledges to sell shares of A carryover of an excess charitable contribution of year are invested in short term notes pending their its common stock at a specified price to an educa- tangible personal property made in 1991 will not complete distribution to the member institutions tional organization is entitled to a charitable con- generate an item of tax preference under section early in the following year. Distinguished by Rev. tribution deduction, in the taxable year thepledge 57(a)(6) of the Code in any succeeding taxable Rul. 60-110. §1.170-2. (Sec. 170, ’86 Code.) is exercised, for the excess of the fair market value year to which the excess maybe carried under the Rev. Rul. 60-l11, 1960-1 C.B. 123. of the shares on the date of the exercise over the rules of section 170. §1.170A–1. (Secs. 57, 170; exercise price. §1.170A-1. (Sec. 170, ’86 Code.) ’86 Code.) 80.20 Athletic scholarship program. Guide- Rev. Rul. 75-348, 1975-2 C.B. 75. Rev. Rul. 90-111, 1990-2 C.B. 30. lines concerning whether payments to athletic 80.28 Bargain sale; timberland; like kind scholarship programs are charitable contributions exchange. An exchange of timberland owned by 80.13 Charitable remainder trusts; sample under section 170, when the payments afford the a producer of forest-related products for bare land forms; annuity. This revenue procedure makes right to purchase preferred seating at university’s of lesser value owned by a state, which is a bargain available a sample form of declaration of trust that home football games. Rev. Rul. 84–132 is clari- sale as defined in reg. 1.170A-4(c)(2)(iii), consti- meets the requirements for an inter vivos charita- fied, distinguished, and superseded. §1.170A-1. tutes as exchange of like kind property.The basis ble remainder annuity trust providing for annuity (Sec. 170, ’86 Code.) of the property received from the state is deter- payments for one life, as described in section Rev. Rul. 86-63, 1986-1 C.B. 88. mined under section 1031(d) as adjusted by apply- 664(d)(1) of the Code. §§1.170A-6, 1.664-2. ing section 1011(b). §§1.170A-4, 1.1011-2, (Sec. 601.201, S.P.R.; Secs. 170, 664, 2522, ’86 80.21 Automobile engine replacement cost. 1.1031(a)-1, 1.1031(d)-1. (Secs. 170, 1011, Code.) The cost of replacing an automobile engine dam- 1031; ’86 Code.) Rev. Proc. 89-21, 1989-1 C.B. 842. aged while transporting Boy Scouts is not deduct- Rev. Rul. 78-163, 1978-1 C.B. 257. ible as a charitable contribution. §1.170-1. (Sec. 80.14 Army Unit Funds; U.S. United States 170, ’86 Code.) 80.29 Benefit to donors. Certain payments to Army Unit Funds are integral parts of the Army Rev. Rul. 59–239, 1959–2 C.B. 100. the Red Cross, a volunteer fire department, the and individuals’ contributions to such funds are Girl Scouts, and a combined charity fund are char- considered as made to or for the use of the United 80.22 Automobile expenses; standard mile- itable contributions under section 170, even States for purposes of the deduction for charitable age rate. Procedures are set forth for use of an though the donors receive some benefits from the contributions. I.T. 3584 superseded. §1.170A-1. optional standard mileage rate by employees or charitable organizations receiving the donations. (Sec. 170, ’86 Code.) self-employed individuals in computing deduct- §1.170A-1. (Sec. 170, ’86 Code.) Rev. Rul. 73-296, 1973-2 C.B. 67. ible costs or operating passenger automobiles Rev. Rul. 80-77, 1980-1 C.B. 56. owned by them for business purposes or for use by 80.15 Art collection; educational gift to city taxpayers in computing transportation expenses 80.30 Benefit to donor; tuition; church-spon- for public museum. Taxpayers donated an orien- relating to charitable contributions, medical sored schools. Tuition paid on behalf of children tal art collection to the city for use in the city’s expense, or moving expenses. Rev. Procs. 80-7, attending parochial, or other types of church- museum which is heavily utilized for credit and 80-32, and 81-54 superseded. §§1.62-1, sponsored schools is not deductible as contribu- classroom courses by the city’s public school sys- 1.162-17, 1.170A-1, 1.213-1, 1.217-2, 1.274-5, tions or gifts. §39.23(o)-1. (Sec. 23(o), ’39 Code; tem and area colleges and universities. Held, tax- 1.1016-3, 1.1031(a)-1. (Sec. 601.105, S.P.R.; Sec. 170, ’86 Code.) payers are entitled to the additional deduction of Secs. 62, 162, 168, 170, 213, 217, 274, 1016, 1031, Rev. Rul. 54-580, 1954-2 C.B. 97. 10 percent of adjusted gross income under section ’86 Code.) 80.31 Benefit to donor; tuition fees and dona- 170(b)(1)(A); the museum is in operation an inte- Rev. Proc. 82–61, 1982–2 C.B. 849. tions; private school. Tuition fees and do nations gral part of the city school system, so that the gift that are required to be paid to a private educational to the city for use in the museum was a gift to the 80.23 Automobile expenses of minister. Auto- organization as a condition of enrollment are not city for expansion and development of its educa- mobile expenses incurred by a minister while ren- gifts and may not be deducted as charitable con- tional organization. (Secs. 170, 503; ’86 Code.) dering services without compensation may not be tributions. §1.170–1. (Sec. 170, ’86 Code.) Avery Brundage, 34 T.C. 1468, Acq. in result, deducted as a business expense, however, they Rev. Rul. 71-112, 1971-1 C.B. 93. 1970–2 C.B. xix. may be deducted as a charitable contribution. §§1.162-2, 1.170-2. (Secs. 162, 170; ’86 Code.) 80.32 Benefit to donor; tuition fees and dona- 80.16 Art object; future or undivided inter- Rev. Rul. 69-645, 1969-2 C.B. 37. tions to private schools. Factual situations illus- est. An individual who transfers title to an art trate the distinction between qualified charitable object to a museum or other exempt donee but 80.24 Ballet school. A ballet school which contributions and tuition payments made to an reserves the right to use it during his lifetime may offers a formal college preparatory program of in organization that operates a private school. Rev. claim a charitable deduction based on the present struction and maintains a regular faculty, curricu- Rul. 79-99 superseded. §1.170A-1. (Sec. 170, ’86 value of the remainder interest in the art object. If lum, and enrollment of students at the place where Code.) he contributes an undivided present interest, the its educational activities are carried on is an educa- Rev. Rul. 83-104, 1983-2 C.B. 46. deduction will be based on the fair market value of tional organization within the meaning of section the undivided present interest. (Sec. 170, ’86 l70(b)(1)(A) and contributions to the school qual- 80.33 Benefit to solicitor; work-study pro- Code.) ify for the additional ten percent charitable con- gram. Amounts paid to an exempt religious orga- Rev. Rul. 57-293, 1957–2 C.B. 153. tributions deduction. §1.170-1. (Sec. 170, ’86 nization by “sponsors,” who are solicited by indi- Code.) vidual members of a work-study program that 80.17 Art object; one-half future interest. The Rev. Rul. 67-447, 1967-2 C.B. 121. includes attendance at the organization’s theologi- owner of an art object who transfers to an orga- cal college, to pay the approximate cost of the indi- nization described in section 170(c), one-half of 80.25 Bargain sale; partnership interest. vidual’s tuition, room and board at the college are his interest in the art object, subject to the retention Income tax consequences are given for a limited not deductible under section 170. §1.170A-1. of control during his lifetime, is entitled to a partner’s charitable contribution of his entire (Sec. 170, ’86 Code.) deduction of the present value of the remainder interest in a limited partnership having liabilities Rev. Rul. 79-81, 1979-1 C.B. 107. interest for the taxable year in which the property that were not personally assumed by the partner- 80.34 Binational charitable foundation. Con- was transferred. §1.170–1. (Sec. 170, ’86 Code.) ship or any of the partners. §§1. 170A-1, 1.170A-4, tributions to a binational charitable foundation Rev. Rul. 58-455, 1958–2 C.B. 100. 1.741-1, 1.752-1, 1.1011-2. (Secs. 170, 741, 752, created by executive agreement between theU.S. 1011; ’86 Code.) and a foreign country, financed by property con- 80.18 Artistic composition; valuation. Sec- Rev. Rul. 75-194, 1975-1 C.B. 80. tributed equally by the two countries, and whose tion 170(e) does not apply to an October 1, 1969, assets, including the contributed property, would contribution to the Library of Congress of an artis- 80.26 Bargain sale; timberland rights be equally divided between the U.S. and the for- tic composition by the taxpayer who created it. reserved. A corporation’s exchange of timber- eign country in the event of dissolution, are not The composition, a noncapital asset described in land, with the corporation reserving the timber- deductible. §1.170A-1. (Sec. 170, ’86 Code.) section 1221 (3), was not a letter, memorandum, or cutting rights, for state-owned timberland of lesser Rev. Rul. 76-195, 1976–1 C.B. 61. similar property, and the amount of the charitable fair market value is not a bargain sale within the contribution is the composition’s fair market value meaning of section 170, and the corporation is not 80.35 Blood donations. Furnishing blood for a at the time of the contribution. §1.170A-4. (Sec. entitled to a charitable contribution deduction; transfusion, or to a blood bank is analogous to the 170, ’86 Code.) however, the exchange qualifies for nonrecogni- rendering of a personal service by the donor rather Rev. Rul. 74-584, 1974-2 C.B. 81. tion of gain or loss under section 1031(a). than a contribution of “property” and the fair mar- Charitable contributions ket value of blood donated by an individual to a 80.44 Canadian or Honduran charitable expenses. §§1.162–15, 1.170–3. (Secs. 162, 170; charitable institution is not deductible as a charita- organizations. Procedures for use in establishing ’86 Code.) ble contribution. §29.23(o)-1. (Sec. 23(o), ’39 the tax-exempt status of charitable organizations Rev. Rul. 63-73, 1963-1 C.B. 35. Code; Sec. 170, ’86 Code.) created or organized under the laws of Canada or Rev. Rul. 162, 1953–2 C.B. 127. Honduras, and determining the deductibility of 80.51 Charitable remainder interest in ali- contributions made to such organizations pursuant mony trust. Under a divorce settlement a tax- 80.36 Board of education; contingent dona- to tax conventions entered into between those payer made an irrevocable transfer of securities to tions. While seeking contributions to help pay for countries and the U.S. §§1.170-1, 1.501(a)–1. a trust for the benefit of his wife. The trust termi- a portion of the cost of constructing a multi-pur- (Sec. 601.201 S.P.R.; Secs. 170,501, ’86 Code.) nates upon her death or remarriage, with remain- pose building, a municipal board of education told Rev. Proc. 59-31, 1959-2 C.B. 949. der over to a charitable foundation. The husband donors that all contributions would be refunded if was entitled to a deduction for charitable contribu- sufficient funds were not raised and that any 80.45 Cancellation of debt. Taxpayers tions for the value of the securities on the date of excess donations would be retained by the board received a mortgage secured note for money transfer minus the present value of the wife’s for general school purposes. The contributions are loaned a charitable organization to build a chapel. income right. He realized no gain on appreciation not deductible under section 170 until they are Each year a portion of the debt was forgiven by in value of the securities transferred. Distin- transferred to the construction fund or retained for endorsing the gift amount on the back of the note. guished from Rev. Rul. 57-507 by Rev. Rul. general school purposes. §1.170A-1. (Sec. 170, Held, the taxpayers were entitled to deduct as a 59-47. (Sec. 170, ’86 Code.) ’86 Code.) charitable contribution the amount cancelled each Rev. Rul. 57-506, 1957-2 C.B. 65. Rev. Rul. 79-249, 1979-2 C.B. 104. year rather than deducting the entire loan in the 80.52 Charitable remainder interest in irre- year made. (Sec. 170, ’86 Code.) vocable trust. Where a taxpayer creates an irrevo- 80.37 Board of Education; securities irrevoc- Nelson Story, 111, 38 T.C. 936, Acq., 1965-1 ably transferred. The fair market value of securi- cable trust for his wife to provide for the discharge C.B. 4. of his obligation to her for the remainder of her ties irrevocably transferred to a County Board of Education to fund a scholarship program, under life, with the remainder interest to an educational 80.46 Capital assets; books purchased at vol- organization, the transfer of property to the trust which the Board has full and exclusive power to ume discount. A taxpayer purchased books at a select scholarship recipients, is deductible by the will result in the realization of taxable income and volume discount from a company located in a taxpayer-donor as a charitable contribution “to” a deductible contribution by the grantor. Capital country where the retail price is legally fixed and an organization referred to in section l70(b)(1)(A) gains realized by the trust, from the disposition of imported them into the U.S. The taxpayer ware- property, which are by the terms of the agreement prior to its amendment by the Tax Reform Act of housed the books for just over 12 months and then 1969. §1.170-1. (Sec. 170, ’86 Code.) specifically allocated to principal, constitute donated them to charitable organizations. The tax- allowable deductions under section 642(c). Dis- Rev. Rul. 70-562, 1970-2 C.B. 63. payer’s activity is tantamount to the activities of a tinguished from Rev. Rul. 57–506 by Rev. Rul. book dealer and the books are ordinary income 59-47. (Sec. 170, ’86 Code.) 80.38 Book collection; future interest; carry- property under section 170(c). If the books’ fair over; limitation period. A charitable contribu- Rev. Rul. 57–507, 1957–2 C.B. 511. market value in the U.S. is equal to or less than the tion deduction claimed for donation of a rare book taxpayer’s basis, the amount of the deduction is 80.53 Charitable remainder interest in per- collection by a taxpayer who retained for life the limited to such fair market value. §1.170A-1. (Sec. sonal residence. No deduction is allowable for the right of full access to the collection and the right 170, ’86 Code.) gift of a remainder interest in a personal residence to deny access to others was a gift of a future inter- Rev. Rul. 79-419, 1979-2 C.B. 107 to a charity by the donors who placed a condition est not properly deductible in the year claimed; on the gift requiring the donee to sell its remainder expiration of the limitation period for the year in 80.47 Capital assets; ornamental plants and interest and receive cash in lieu thereof if the which the deduction was claimed does not bar dis- lithograph prints. A taxpayer who raises orna- donors decided to sell the residence before they allowance of the deductions for subsequent carry- mental plants, as a hobby, and each year donates die. §1.170A-1. (Sec. 170, ’86 Code.) over years. §§1.170A-5, 301.6501(a)-1. (Secs. a large number to various charities and a taxpayer, Rev. Rul. 77-305, 1977-2 C.B. 72. 170, 6501; ’86 Code.) not an art dealer, who purchased a substantial part Rev. Rul. 77-225, 1977–2 C.B. 73. of the total limited edition of a particular litho- 80.54 Charitable remainder trusts; invest- graph print and donated the prints to various art ment of assets. The investment by a university, as 80.39 Books; library of bank. A donation of trustee, of the assets of charitable remainder trusts museums are engaged in activities substantially books to a bank for use in its public library is not in its general endowment investment fund will not equivalent to those of commercial dealers, and the deductible as a charitable contribution. (Sec. 170, jeopardize the exempt status of the charitable amount of each contribution is subject to the ’86 Code.) reduction provisions of section 170(c), remainder trusts or the donor’s charitable con- Rev. Rul. 57-600, 1957-2 C.B. 162. tribution deductions. Rev. Rul. 73–571 amplified. §1.170A-1. (Sec. 170, ’86 Code.) 80.40 Books; library of bar association. The Rev. Rul. 79–256, 1979-2 C.B. 105. §§1.170A-6, 1.664-1. (Secs. 170, 664; ’86 Code.) Rev. Rul. 83–19, 1983–1 C.B. 115. value of books contributed to the professional library of a bar association, an exempt business 80.48 Capital gain property; limitation; elec- 80.55 Charitable remainder unitrust; funded league, is not deductible as a charitable contribu- tion; amended return. A taxpayer whose con- by income-producing securities. A contribution tion. §§1. 170-1. (Sec. 170, ’86 Code.) tributions of capital gain property were deducted of appreciated income-producing securities to a Rev. Rul. 58-293, 1958-1 C.B. 146. on a timely filed return and were limited to 30 per- university through a charitable remainder unitrust, cent of the taxpayer’s contribution base may not whose governing instrument contained no express 80.41 Books received by book reviewer; elect to deduct contributions of capital gain prop- or implied obligation to sell or exchange the secu- donated to charity. The value of books received erty up to the 50 percent limitation of section 170(b)(1)(A) on an amended return filed after the rities, is a deductible charitable contribution sub- and accepted by a book reviewer during his ject to the limitations of section 170(b) in an employment with a newspaper, which he donated due date for filing the original return. §1.170A-8. amount equal to the actuarial computation of the to a charitable organization and claimed a con- (Sec. 170, ’86 Code.) present value of the remainder interest valued at tribution deduction for their value, is includable in Rev. Rul. 77-217, 1977-1 C.B. 64. net fair market value at the time the securities were his gross income. Rev. Rul. 70–330 superseded. transferred to the trust. §§1.170A-6, 1.170A-8, §1.61-1. (Sec. 61, ’86 Code.) 80.49 Cemetery organization for perpetual care. Voluntary contributions to or for the use of 1.664A. (Secs. 170, 664; ’86 Code.) Rev. Rul. 70-498, 1970-2 C.B. 6. Rev. Rul. 74–53, 1974–1 C.B. 60. a nonprofit cemetery organization, the funds of 80.42 Broadcast time donated by radio sta- which are irrevocably dedicated to the perpetual 80.56 Charities designated by corporation tion. A radio station providing broadcast time, care of the cemetery, as a whole, are deductible by employees. Amounts paid by a corporation to without charge, for various religious and other the donors as charitable contributions. However, qualified religious, charitable, and educational public affairs programs, may not deduct the fair a donor may not deduct a contribution for the per- organizations designated by its employees pur- market value of such time as a charitable contribu- petual care of a particular lot or mausoleum. Pay- suant to a charitable designation plan are deduct- tion. §1.170-1. (Sec. 170, ’86 Code.) ments which constitute apart of the purchase price ible by the corporation; the employees are not in Rev. Rul. 67–236, 1967–2 C.B. 103. of a lot or mausoleum and are irrevocably dedi- receipt of gross income with respect to these con- cated to a perpetual care fund are not deductible as tributions. §§1.61-1, 1.170-1. (Secs. 61, 170; ’86 80.43 Brokerage corporation; business a charitable contribution. (Sec. 170, ’86 Code.) Code.) expenses. A stock brokerage corporation’s pay- Rev. Rul. 58-190, 1958-1 C.B. 15. Rev. Rul. 67-137, 1967-1 C.B. 63. ments to a charitable organization described in section 170(c)(2), made with a reasonable 80.50 Charitable organization cooperating in 80.57 “Charity Day” proceeds distributed by expectation of a financial return commensurate advertising program. Amounts paid by a corpo- race track. “Charity Day” proceeds distributed with the amount of the payments, are deductible as ration to a charitable organization for the use of its to a charitable foundation by a pari-mutuel race a business expense. §§1.162–1, 1.170-1. (Secs. name and cooperation in connection with the cor- track corporation must be included in the corpora- 162, 170; ’86 Code.) poration’s advertising program are not gifts or tion’s income. Such amount is not a deductible Rev. Ru1. 72-314, 1972-1 C.B. 44. contributions but are deductible business business expense but is deductible as a charitable Charitable contributions contribution. Distinguished by Rev. Rul. 77–121. tribution of a church directory are not deductible exclusively public purposes. §1.1702. (Sec. 170, §§1.61-2, 1.162-15,1.170-3. (Secs. 61, 162, 170; as charitable contributions. (Sec. 170, ’86 Code.) ’86 Code.) ’86 Code.) Rev. Rul. 57-525, 1957-2 C.B. 159. Rev. Rul. 58-464, 1958–2 C.B. 103. Rev. Rul. 72-542, 1972-2 C.B. 37. 80.66 Church missionary fund; designated 80.74 Civil Air Patrol; vehicle expenses. 80.58 “Charity Day’’ proceeds distributed by missionary. Taxpayer’s contributions to a mis- Expenses directly attributable to the performance race track. Charity day race proceeds distributed sion, some of which were designated for the sup- of volunteer services for the Civil Air Patrol are by a parimutuel race track corporation to an port of specific missionaries, were all placed in a deductible as charitable contributions. Such exempt charitable organization that agreed to common pool and used as the mission saw fit. expenses include operation, maintenance and absorb any losses arising from the event and Held, the amounts were deductible. (Sec. 170, ’86 repair of vehicles. However, no deduction is assume all responsibility for promotion are not Code.) allowable for the fair rental value of such use, the includible in the corporation’s gross income for George E. Peace, 43 T.C. 1, Acq., 1965-2 C.B. depreciation occasioned by such use, or for liabil- Federal income tax purposes. Rev. Rul. 72-542 6. ity and property damage insurance carried on such distinguished. §§1.61-2, 1.170A-1. (Secs. 61, vehicle for the protection of the individual. 170; ’86 Code.) 80.67 Church missionary fund; donor’s son §1.170-1. (Sec. 170, ’86 Code.) Rev. Rul. 77-121, 1977-1 C.B. 17. serving as missionary. Payments made to a mis- Rev. Rul. 58-279, 1958-1 C.B. 145. sionary from a church fund as reimbursement for 80.75 Club members; sickness or burial 80.59 “Charity Day” profits distributed by travel and living expenses incurred in the services race track. A parimutuel race track corporation of his church are not includible in the missionary’s expenses. Contributions to a club for the purpose that agrees to promote, and absorb any losses gross income. Contributions to the church fund by of defraying sickness or burial expenses of from, extra racing days each year for the benefit of the parent of the missionary are deductible as char- deceased members of the club constitute contribu- local charities to obtain and ensure retention of its itable contributions if the organization has full tions made to individuals and, as such, are not license must include revenues from the extra days control of the donated funds and discretion as to deductible by the donors. (Sec. 170, ’86 Code.) in its gross income and may deduct as a business Rev. Rul. 57–188, 1957-1 C.B. 97. expense under section 162 the profits turned over their use. The parent may claim the dependency 80.76 College fraternity. A college fraternity wbere the to the charities. §§1.61–1, 1.162–1, 1.170A-1. exemption (excluding son’s gross income is less than $600 the reimbursed expenses) organized on a non-profit basis that maintains a (Secs. 61, 162, 170; ’86 Code.) and amounts furnished directly by the parent to his chapter house for active members who are stu- Rev. Rul. 77-124, 1977-1 C.B. 39. son constitute more than one-half of his total sup- dents of the school, is exempt from tax as a social 80.60 Child care expenses. Amounts paid by a port for the calendar year. §§1.61-1, 1.151-2, club under section 501(c)(7) but is not exempt under taxpayer for the care of her children while she per- 1.170-1. (Secs. 61, 151, 170; ’86 Code.) section 501(c)(3). Contributions to the fraternity formed gratuitous services for a charitable orga- Rev. Rul. 62-113, 1962-2 C.B. 10. are not deductible. I.T. 1427 and G.C.M. 5952 nization are personal expenses not deductible as superseded. §§1.170-1, 1.501(c)(3)-1, charitable contributions or as child care expenses. 80.68 Church of Scientology. The legislative 1.501(c)(7)-1. (Secs. 170, 501; ’86 Code.) §§1.170A-1, 1.262-1. (Secs. 170, 214, 262; ’86 history of the “contribution or gift” limitation Rev. Rul. 69-573, 1969-2 C.B. 125. Code.) under section 170 reveals that Congress intended to differentiate between unrequited payments to 80.77 Communal religious organization. Rev. Rul. 73-597, 1973-2 C.B. 69. Contributions made to or for the use of a commu- qualified recipients, which are deductible, and nal religious organization exempt under section 80.61 Child care service; food program. Pay- payments made to such recipients with some 501(d) are not deductible if such organization is ments received from a sponsoring charitable orga- expectation of a quid pro quo in terms of goods or engaged in the operation of a commercial enter- nization pursuant to the Child Care Food Program services, which are not deductible. (Sec. 170, ’86 prise the proceeds of which inure to the common are excludable from a day care home operator’s Code.) benefit of its members. §1.642(c)-1. (Secs. 170, gross income to the extent that such payments do Hernandez, Ct. D. 2046, 1989-2 C.B. 55. 642; ’86 Code.) not exceed expenses incurred in feeding children Rev. Rul. 57-574, 1957-2 C.B. 161. eligible for assistance under the program. Any 80.69 Church of Scientology. Revenue Ruling portion of the payment that compensates the oper- 78-189 is obsoleted. §1.170A-1. (Sec. 170, ’86 80.78 Community recreational organization; ator for services is includable in income. Out-of- Code.) facilities restricted. A nonprofit corporation pocket expenses in excess of reimbursement are Rev. Rul. 93-73, 1993-2 C.B. 75 which was organized to provide community recre- deductible under section 170 where no profit ational facilities without charge to the residents of motive exists and under section 162 where such 80.70 Church operated schools with discrimi- a township, but which restricts their use to less motive does exist. §§1.61–1, 1.162–1, 1.170A-1. natory policies. Organizations, including than the entire community on the basis of race is (Secs. 61, 162, 170; ’86 Code.) churches, that conduct schools with a policy of not organized and operated exclusively for chari- Rev. Rul. 79-142, 1979-1 C.B. 58. refusing to accept children from certain racial and table purposes. Contributions and transfers to or ethnic groups will not be recognized as tax-ex- for the use of such an organization are not deduct- 80.62 Child care service; out-of-pocket empt charities. §§1.170A-1, 1.561(c)(3)–1. (Secs. ible. §1.170–1. (Sec. 170, ’86 Code.) expenses. Factual situations illustrate the tax 170, 501; ’86 Code.) Rev. Rul. 67-325, 1967–2 C.B. 113. treatment of amounts received and amounts Rev. Rul. 75-231, 1975-1 C.B. 158. expended by individuals providing child care ser- 80.79 Community trusts; governing instru- vices in their own homes. Rev. Rul. 56-70 super- 80.71 Church owned by taxpayer. Expendi- ments. Examples are given of provisions in the seded. §§1.61-1, 1.62-1, 1.162-1, 1.170-2, tures made by the taxpayer to repair and refurbish governing instruments of community trusts that 1.1401-1. (Secs. 61, 62, 162, 170, 1401, 3121, a chapel owned by him and located on his prop- meet the requirements of reg. 3306, 3401; ’86 Code.) erty, which has been used exclusively as a public 1.170A-9(e)(11)(v)(B). §1.170A-9. (Sec. 170, ’86 Rev. Rul. 77-279, 1977-2 C.B. 12. church by the surrounding community for more Code.) than 240 years, were deductible as charitable con- Rev. Rul. 77-333, 1977-2 C.B. 75. 80.63 Church; benefit of contributors. An tributions. (Sec. 23(o), ’39 Code; Sec. 170, ’86 individual who claims to be a minister, organizes Code.) 80.80 Community trusts; required resolu- a church, deposits checks for salary earned from tions. Examples are given of resolutions adopted Philip A. Carroll, 38 T.C. 868, Acq., 1963-2 by community trusts with respect to the adminis- outside employment in the church’s bank account, C.B. 4. and uses the funds of the account for lodging, food, tration of such trusts or funds that satisfy the clothing, and other living expenses is not entitled 80.72 Civic league distributing literature to requirements of reg. 1.170A-9(e)(11)(v)(E) and to a charitable deduction for the amount of the schools, etc. Payments to a tax-exempt noncharit- (F). §1.170A-9. (Sec. 170, ’86 Code.) salary checks. §1.170A-1. (Sec. 170, ’86 Code.) Rev. Rul. 77-334, 1977–2 C.B. 77. Rev. Rul. 78–232, 1978–1 C.B. 69. able organization described in section 501(c)(4) for the purpose of subsidizing the dissemination of 80.81 Congress member; constituents’ con- 80.64 Church building bonds purchased. The its literature to charitable, educational, etc., orga- tributions; trust fund for travel expenses. Con- amount paid to purchase building bonds issued by nizations described in section 501(c)(3) are not tributions to a trust established to provide funds a church is not deductible as a charitable contribu- deductible as charitable contributions. (Sec. 170, for certain travel expenses incurred by a taxpayer tion. However, the fair market value of such bonds ’86 Code.) as a Member of Congress and the taxpayer’s staff if donated to the church may be deductible as a Rev. Rul. 55-269, 1955-1 C.B. 29. in connection with the performance of official charitable contribution. §1.170-1. (Sec. 170, ’86 duties do not qualify as gifts under section 102(a) Code.) 80.73 Civic organization. Contributions made and are includable in the taxpayer’s gross income Rev. Rul. 58-262, 1958-1 C.B. 143. to a civic organization whose activities are in the year received by the trust. However, the designed to promote the welfare of a particular amounts disbursed for travel expenses are deduct- 80.65 Church directory published by individ- community and to restrict business interests in the ible business expenses, unexpended funds ual. Contributions or gifts to an individual for the area are not deductible as charitable contributions returned to the contributors on termination of the purpose of financing the publication and free dis- to or for use of a political subdivision of a state for trust are deductible as a business loss, and any por- Charitable contributions tion of the contributions donated from the termi- if they are enforceable. If the obligation is not the total cost basis of the remaining property. nated trust to charitable organizations is deduct- enforceable, any payment of “interest” is allow- (Secs. 170, 1011; ’86 Code.) ible to the extent provided in section 170. able as a charitable contribution. Distinguished by Rev. Rul. 57-488, 1957-2 C.B. 157. §§1.61-1, 1.102-1, 1.162-2, 1.165-1, 1.170A-1. Rev. Rul. 78-38. §§1.163-1, 1.170-1. (Secs. 163, (Secs. 61, 102, 162, 165, 170; ’86 Code.) 170; ’86 Code.) 80.97 Domestic charity; funds for foreign Rev. Rul. 76-276, 1976-2 C.B. 14. Rev. Rul. 68-174, 1968-1 C.B. 81. charity. Deductibility of contributions by individ- uals to a charity organized in the U.S. which there- 80.82 Congressional salary returned to Trea- 80.89 Debt for equity swaps. The federal after transmits some or all of its funds to a foreign sury. The salary of a Congressman is gross income tax consequences are set forth for various charitable organization are discussed in connec- income; however, any portion which he returns to transactions that are a part of a foreign country’s tion with five illustrative examples. Amplified by the U.S. Treasury is deductible as a charitable con- program to reduce the amount of its outstanding Rev. Rul. 66-79. §1.170-2. (Sec. 170, ’86 Code.) tribution. (Secs. 61, 170; ’86 Code.) U.S. dollar denominated debt. §§1.170A-1, Rev. Rul. 63-252, 1963-2 C.B. 101. Rev. Rul. 56–126, 1956-1 C.B. 56. 1.1001-1. (Secs. 170, 1001; ’86 Code.) Rev. Rul. 87–124, 1987–2 C.B. 205. 80.98 Domestic charity; funds for foreign 80.83 Corporation; donation of dated prod- charity. Contributions to a domestic charity, ucts. When a corporation donates products to a 80.90 Deductibility; rulings and determina- solicited for a specific project of a foreign charita- charitable organization shortly before their tion procedures. Procedures are provided for ble organization, are deductible as charitable con- expiration date, the amount allowable as a charita- applying for recognition of exemption and for tributions where the domestic charity has ble contribution deduction is equal to the unreal- revoking or modifying exemption rulings and reviewed and approved the project as being in fur- ized appreciation, not to exceed twice the taxpay- determination letters. Rev. Procs. 72-4, 76-33, therance of its own exempt purposes and has con- er’s basis in such property. Rev. Rul. 83–29 77-21, superseded; Rev. Proc. 76-34 modified; trol and discretion as to the use of the contribu- clarified and superseded. §§1.170A-1, Rev. Proc. 77–31 revoked. Amplified by Rev. tions. Rev. Rul. 63–252 amplified. §1.1701. 1.170A-4A. (Sec. 170, ’86 Code.) Proc. 80-28. §§1.170A-1, 1.501(a)-1, (Sec. 170, ’86 Code.) Rev. Rul. 85–8, 1985–1 C.B. 59. 1.509(a)-1, 1.521-1, 53.4942(b)-1. (Sec. Rev. Rul. 66-79, 1966-1 C.B. 48. 601.201, S.P.R.; Secs. 170, 501, 509, 521, 4942, 80.99 Domestic charity; funds used in foreign 80.84 Corporation; transfers to exempt sole 7428, ’86 Code.) stockholder. Amounts transferred without con- country. A domestic commercial corporation is Rev. Proc. 80-25, 1980-1 C.B. 667. entitled to a charitable contribution deduction for sideration by a taxable corporation to its sole stockholder, an organization exempt from tax 80.91 Deductible amount; patrons receiving unrestricted contributions to a domestic charitable under section 501(c)(3), are distributions consti- something in return. Guidelines on when bene- corporation even though the contribution is used tuting dividends to the extent provided in section fits received in connection with a payment to char- in a foreign country. §1.170-3. (Sec. 170, ’86 316(a) and are not deductible as charitable con- ity will be considered to have insubstantial fair Code.) tributions. §§1.170–3, 1.316–1, 1.512(b)–1. market value for purposes of advising patrons how Rev. Rul. 69–80, 1969–1 C.B. 65. (Secs. 170, 316, 512; ’86 Code.) much is deductible and how much is not. Rev. Rul. 80.100 Domestic charity; funds used in for- Rev. Rul. 68-296, 1968-1 C.B. 105. 67-246 amplified. §1.170A-1. (Sec. 170, ’86 eign country. Contributions by an individual to a Code; sec. 601.105, S.P.R.) domestic charity, formed to deal with the problem 80.85 Crop shares. The fair market value of Rev. Proc. 90-12, 1990-1 C.B. 471. crop shares received as rent by a farmer-landlord, of plant and wildlife ecology in a foreign country which are contributed to a charitable organization through programs that include grants to foreign 80.92 Deductible amount; patrons receiving organizations and over which it maintains control or are used as feed in the farming operation, must something in return. Guidelines on when chari- be included in the farmer-landlord’s gross income and responsibility, are deductible as charitable ties may advise potential contributors that con- contributions. §1.170A-1. (Sec. 170, ’86 Code.) at the time of such contribution or use. The tax- tributions are fully deductible, when charitable Rev. Rul. 75-65, 1975–1 C.B. 79. payer is considered to have made a charitable con- solicitations are accompanied by free, unordered, tribution or becomes entitled to a business expense low cost items. Rev. Proc. 90-l2 amplified. 80.101 Educational organization; elemen- deduction at the same time and in the same amount §1.170A-1. (Sec. 601.105, S.P.R.; Sec. 170, ’86 tary school. An organization providing an ele- as the income recognized. Taxpayer may be Code.) mentary education for children may meet the entitled to use the optional method of determining Rev. Proc. 92-49, 1992-1 C.B. 987. requirements for an educational organization and, net earnings from self-employment under section therefore, is not a private foundation even though 1402(a) and the retirement income credit under 80.93 Deductible amount; patrons receiving it has no formal course program or formal class- section 37. Rev. Ruls. 56-496 and 63-66 modi- something in return. Guidance is provided to room instruction. §1.170-1. (Secs. 170, 509; ’86 fied. §§1.61-4, 1.162-12, 1.170A-1, 301.7805-1. section 501(a) exempt organizations in determin- Code.) (Secs. 61, 162, 170, 7805; ’86 Code.) ing the inflation adjusted amounts for the years Rev. Rul. 72-430, 1972–2 C.B. 105. Rev. Rul. 75-11, 1975–1 C.B. 27. 1991 and 1992, for the definition of “low cost article” under section 513(h)(2), on when benefits 80.102 Educational organization; guided 80.86 Cumulative List of organizations. The received in connection with a payment to charity tours with incidental instruction. An exempt extent to which contributors may rely on the list- will be considered to have an insubstantial fair organization whose primary function is conduct- ing of organizations in Publication No. 78, Cumu- market value for the purposes of advising patrons ing guided tours, during which the participants are lative List of Organizations, for purposes of how much is deductible and how much is not. Rev. instructed in the skills and crafts of the area in deducting contributions under section 170 and for Proc. 90-12 supplemented. §1.170A-1. (Sec. which they are touring, does not qualify as a non- making grants under section 4945, is provided. 601.105, S.P.R.; Secs. 170, 513, ’86 Code.) profit educational organization. §1.170A-9. (Secs. Rev. Proc. 72-39 superseded. §§1.170A-1, Rev. Proc. 92-58, 1992-2 C.B. 410. 170, 4057, 4221, 4294; ’86 Code.) 1.501(c)(3)–1, 53, 4945–5. (Sec. 601.105, S.P.R.; Rev. Rul. 76-237, 1976-1 C.B. 330. Secs. 170, 501, 4945,7428; ’86 Code.) 80.94 Deductions; raffle tickets; home sold Rev. Proc. 82–39, 1982–2 C.B. 759. through charity raffle. The tax consequences of 80.103 Educational organization; oriental the sale of a personal residence through a raffle philosophy and psychic phenomena courses. 80.87 Dance lessons. The value of the right to conducted by a charitable organization are dis- An organization exempt under section 501(c)(3) dancing lessons purchased from a dancing school cussed. §§1.61–1, 1.165–1, 1.170A-1, 1.1001–1. that offers a variety of lectures, workshops, and and subsequently donated to a qualified charitable (Secs. 61, 165, 170, 1001; ’86 Code.) short courses on oriental philosophies and psychic organization for use in furthering its charitable Rev. Rul. 83-130, 1983-2 C.B. 148. phenomena, led by various invited authorities and purposes is deductible. The amount paid for the noted personalities in these fields and open to the lessons may serve as a guide in determining the 80.95 Depreciable property; multiple asset general public as well as members who wish to value of the right. §1.170-1. (Sec. 170, ’86 Code.) account. The method is provided for determining attend, is not an educational organization. Rev. Rul. 68–113, 1968-1 C.B. 80. the amount of a charitable contribution for prop- §1.170A-9. (Sec. 170, ’86 Code.) erty retired from a multiple asset account for Rev. Rul. 78–82, 1978-1 C.B. 70. 80.88 Debenture bond or promissory note. A which the CLADR system had not been elected. debenture bond or a promissory note issued and §§1.167(a)-8, 1.170A-1. (Secs. 167, 170; ’86 80.104 Educational organization; student delivered by the obligor to a charitable organiza- Code.) intern program. An organization exempt under tion represents a mere promise to pay at some Rev. Rul. 80-174, 1980-2 C.B. 67. section 501(c)(3), that conducts an internship pro- future date and is not a “payment” for purposes of gram placing college and university students with section 170. However, a charitable contribution 80.96 Development land; release to county. cooperating government agencies for a semester, deduction is allowable for the payment made to The release of frontage to a county, for widening is not an educational organization described in redeem the bond or for the required face amount a road, in order to obtain required approval by the section 170(b)(1)(A)(ii) and is a private founda- payments irrespective of whether the payments county planning commission of the plot plan of tion unless otherwise described in section 509(a). are made to the charitable organization or to a sub- certain lots prior to their sale, does not constitute §§1.170A-9, 1.509(a)-1. (Secs. 170, 509; ’86 sequent transferee. In addition, a deduction is a gift, nor does it qualify as a charitable contribu- Code.) allowable for interest paid on the obligations only tion. However, the cost of the frontage is a part of Rev. Rul. 76-417, 1976-2 C.B. 58. Charitable contributions 80.105 Educational organization; summer ciaries. §§1.642(c)–1, 1.661(a)–2. (Secs. 642, the second case is limited to the cash paid. school. The additional ten percent charitable 661; ’86 Code.) §1.170A-1. (Sec. 170, ’86 Code.) deduction is applicable to contributions to an Rev. Rul. 68–667, 1968-2 C.B. 281. Rev. Rul. 80-329, 1980-2 C.B. 70. exempt educational organization whose only function is to conduct classes for eight weeks each 80.113 Estates and trusts; income from 80.120 Fair market value; gems. A taxpayer summer during which it maintains a regular fac- realty. Income received by executors from realty purchased an assortment of gems from a promoter ulty and curriculum with regularly enrolled stu- specifically devised in trust for charitable pur- who asserted that the price was “wholesale” and dents. §1.170-1. (Sec. 170, ’86 Code.) poses, but subject to administration under state who claimed that if the taxpayer held the gems for Rev. Rul. 69-492, 1969-2 C.B. 36. law, is includible in the gross income of the estate over one year and then contributed them to charity, and deductible as a charitable donation. the taxpayer would be entitled to deduct three 80.106 Educational organization; trade §1.642(c)-1. (Sec. 642, ’86 Code.) times the price paid. The deduction allowable is school. A nonprofit organization created as a Rev. Rul. 57-133, 1957-1 C.B. 200. the fair market value of the gems at the time of the result of collective bargaining agreements to train contribution, not an artificially calculated esti- individuals desiring to acquire skills in an industry 80.114 Estates and trusts; set-aside deduc- mate of value. The best evidence for the fair mar- is exempt under section 501(c)(3); it is also an tion. If a trustee has discretionary power under a ket value is the price at which the promoter sold educational organization described in section will to allocate gains from the sale or other disposi- the gems to the taxpayer. §1.170A-1. (Sec. 170, l70(b)(1)(A) and, therefore, is not a private tion of property constituting principal either to ’86 Code.) foundation under section 509(a). §§1.170-1, income or to principal, any amount set aside for Rev. Rul. 80-69, 1980-1 C.B. 55. 1.501(c)(3)-1. (Secs. 170, 501, 509; ’86 Code.) charitable purposes is not deductible. §1.642(c)-1. (Sec. 642, ’86 Code.) 80.121 Family cemetery company. Contribu- Rev. Rul. 72-101, 1972-1 C.B. 144. tions to an organization which owns, operates, and Rev. Rul. 73-95, 1973-1 C.B. 322. maintains a cemetery for the exclusive burial of 80.107 Employees’ pension trust. A trust orga- lineal descendants of a particular family and those nized primarily to pay pensions to retired 80.115 Exempt organization; noneducational who intermarry with those descendants, and employees, and to provide incidental benefits to activities. The extra ten percent deduction for which is supported by funds from the descendants, employees or their beneficiaries in times of need, charitable contributions to exempt organizations are not deductible. §1.170–1. (Sec. 170, ’86 is not exempt as a charitable organization. Con- does not apply to an organization which does not Code.) tributions to such a trust are not deductible by the meet the requirements of section 503(b)(2) of Rev. Rul. 65-6, 1965–1 C.B. 229. donors as charitable contributions. (Secs. 170, maintaining a regular faculty and curriculum and 501; ’86 Code.) having a regularly enrolled body of pupils or stu- dents, even though such an organization accom- 80.122 Federal social security trust fund; vol- Rev. Rul. 56-138, 1956-1 C.B. 202. untary contribution. A voluntary contribution to plishes its exempt educational purposes by hold- ing conferences, discussions, and seminars to the federal social security trust fund is a contribu- 80.108 Employees’ pension trust; exempt which prominent men and women from all fields tion to the United States for purposes of section organization; third party donors. Contributions 170(c)(1), and is deductible under section 170. made by third parties to a pension plan trust estab- of endeavor are invited to attend and participate. §1.170A-1. (Sec. 170, ’86 Code.) lished by an exempt organization for the benefit of §1.170-2. (Sec. 170, ’86 Code.) Rev. Rul. 82-169, 1982-2 C.B. 72. its employees are deductible by the donors as char- Rev. Rul. 64-128, 1964-1 (Part 1) C.B. 191. itable contributions. §1.170-1. (Sec. 170, ’86 80.116 Expenses; foster care. Factual situa- 80.123 Fees of staff physicians remitted to Code.) hospital. Staff physicians of a hospital must tions illustrate the tax treatment of amounts include in their gross income fees received from Rev. Rul. 71-270, 1971-1 C.B. 94. received and amounts expended by individuals insurance for treatment of patients admitted to the providing foster care to children. I.T. 4068 super- hospital without a physician’s recommendation 80.109 Employer contributions; union seded. §§1.61–1, 1.62–1, 1.151–2, 1.162–1, educational and cultural trust. A statement in an even though they voluntarily turn the fees over to 1.170-2, 1.1401-1, 1.6041-1. (Secs. 61, 62, 151, the hospital. However, they are entitled to a chari- exemption ruling that contributions to a tax-ex- 162, 170, 280A, 1401, 3121, 3306, 3401, 6041; empt union educational and cultural trust are ’86 Code.) table contribution deduction for the amounts deductible by the donors under section 170 does turned over to the hospital. Amplified to provide Rev. Rul. 77-280, 1977-2 C.B. 14. that medicare fees collected by a charitable orga- not preclude the deduction under section 162 of payments made to the trust by an employer as a 80.117 Expenses; aiding hurricane evacuees. nization are includable in the gross income of the result of a collective bargaining agreement if the Actual unreimbursed expenses incurred by an physician performing the services for which the payments otherwise qualify as business expenses. individual directly connected with and solely fees were paid, such fees are not deductible by the §§1.162-10, 1.170-3. (Secs. 162, 170; ’86 Code.) attributable to providing necessities such as food, individual physician as an ordinary and necessary Rev. Rul. 74-51, 1974-1 C.B. 45. business expense, but are deductible as a charita- lodging and clothing to hurricane evacuees, ble contribution. Rev. Rul. 66–377, providing that referred to him by an organization described in fees remitted to a medical school as required by an 80.110 Endowment life insurance contract. section 170 during the emergency are deductible Taxpayer sold an unencumbered life insurance as contributions or gifts. (Sec. 170, ’86 Code.) employment contract are includable in gross policy to a charitable organization for an amount income but deductible as business expenses, dis- Rev. Rul. 66-10, 1966-1 C.B. 47. tinguished. §§1.61–2, 1.162–1, 1.170–1. (Secs. equal to his basis therein donating his remaining interest to charity. At the same time, he made a gift 80.118 Fair market value; bibles. A taxpayer 61, 162, 170; ’86 Code.) of an unencumbered annuity contract to his son, In purchased bibles from a promoter who asserted Rev. Rul. 69-275, 1969-1 C.B. 36; Rev. Rul. the following year, both contracts matured and that they could be purchased at a considerable dis- 70-161, 1970-1 C.B. 15. were surrendered by the donees. Held, the donor count from retail price and claimed that if the tax- 80.124 Films donated by producer. Films pro- receives taxable income at the time the insurance payer held the bibles over twelve months and then duced by taxpayer and donated to qualifying char- company pays the donees, a gift of such a contract contributed them to a charitable organization, the ities were tangible commodities with values sepa- to a charitable organization is a charitable gift in taxpayer would be entitled to deduct the “retail” rate from the services going into their production. the year the contract is transferred, and a gift of the price as a charitable contribution. The charitable The value assigned to the films by taxpayer was contract to his son is subject to gift tax for the year deduction is limited to the fair market value of the creditable and uncontested and allowable as a of its transfer. §§1.61–1, 1.170-1. (Secs. 61, 170; bibles at the time of contribution, and the best evi- deduction. (Sec. 170, ’86 Code.) ’86 Code.) dence of the fair market value at that time is the John R. Holmes, 57 T.C. 430, Acq., 1972-1 C.B. Rev. Rul. 69-102, 1969-1 C.B. 32. price at which similar lots of bibles are being sold 2. to others. §1.170A-1. (Sec. 170, ’86 Code.) 80.111 Equity in timber sale. Taxpayer trans- Rev. Rul. 80-233, 1980-2 C.B. 69. 80.125 Financial support; educational insti- ferred to charity an equity interest in standing tim- tutions. Amounts paid by a corporation under a ber which he sold as agent for himself and the 80.119 Fair market value; bibles. A promoter two-part program to provide financial support in charity, at its request, with the buyer paying the offers investors a choice of two plans to purchase the form of scholarships or grants-in-aid to educa- charity directly for its interest. Held, the transfer bibles and donate them to charities. Under one tional institutions exempt under section 501(c)(3) was a valid gift, not an anticipatory assignment of plan, investors purchase the bibles and donate are deductible as charitable contributions. income. (Sec. 61, ’86 Code.) them to charity 12 months later, The investors are §1.170-1. (Sec. 170, ’86 Code.) Stuart A. Rogers, 38 T.C. 785, Nonacq., 1963-2 told that they may deduct the “retail” price, which Rev. Rul. 68-484, 1968-2 C.B. 105. C.B. 6. is three times as high as the purchase price. Under the other plan, investors purchase the bibles at the 80.126 Foreign exchange program. Fees paid 80.112 Estates; charitable bequest paid from “retail” price, put down the same amount as the by a family participating in a foreign exchange corpus. Amounts bequeathed to a charity that are purchase price in the first plan and execute prom- program equal to the cost of travel and insurance paid out of the corpus of an estate pursuant to state issory notes for the balance. Principal and interest and the expenses incurred on behalf of the foreign law are not deductible as charitable contributions on the notes is payable in 12 years. The investors child while living in the U.S. family’s household nor allowable as distribution deductions to benefi- then donate the bibles to charity. The deduction in are not charitable contributions. However, con- Charitable contributions tributions from a participating family that exceed expenses directly connected with the hosting of a 80.142 Inaugural Committee. A donation to a the fair market value of services received from the governors’ conference is deductible as a charita- Presidential inaugural Committee that sponsors program are deductible. §§1.170A-1. ble contribution but the value of merchandise inaugural activities some for which are open to the 1.501(c)(3)-1. (Secs. 170, 501; ’86 Code.) presented to the visiting governors and their wives public and some by invitation only is neither a Rev. Rul. 80-286, 1980-2 C.B. 179. as personal mementos is not deductible. §1.170–1. charitable contribution deductible as a gift “to or (Sec. 170, ’86 Code.) for the use of” the U.S. for “exclusively” public 80.127 Foundation; loans to creator and con- Rev. Rul. 69-459, 1969-2 C.B. 35. purpose under section 170(c)(1) nor a contribution trolled corporations. Taxpayers created a chari- deductible to an organization operated exclusively table foundation which, in addition to making con- 80.135 Health care organizations; medicare for charitable purposes under section 170(c)(2). tributions to religious and charitable and medicaid payments exempt functions. §1.170A-1. (Sec. 170, ’86 Code.) organizations, made loans for noncharitable pur- Medicare and medicaid payments constitute gross Rev. Rul. 77–283, 1977-2 C.B. 72. poses to taxpayers and others. Held, contributions receipts derived from the exercise or performance to the foundation were deductible. (Sec. 23(o), ’39 of a health care organization’s exempt activities 80.143 Income interest; participation fund. Code; Sec. 170, ’86 Code.) for purposes of the support test of sections The method of reporting contributions of money Donald G. Griswold, 39 T.C. 620, Acq., 1965-1 170(b)(1)(A)(vi) and 509(a)(2). §§1.170A-1, and property made to an income participation fund C.B. 4. 1.509(a)-3. (Secs. 170, 509; ’86 Code.) of an exempt organization where payments from Rev. Rul. 83-153, 1983-2 C.B. 48. the net income of the fund are to be made to the 80.128 Fraternal organization building fund. contributors or to the contributors and their desig- Contributions to a building fund of a fraternal nated coparticipants during their lives. 80.136 Highway safety program. Amounts organization are not deductible where the building §39.23(o)-1. (Sec. 23(o), ’39 Code; Sec. 170, ’86 paid to a State Department of Highway Safety for is to be used for the organization’s fraternal activi- Code.) use in developing a highway safety program ties even though some of the activities of the orga- Rev. Rul. 55–275, 1955–1 C.B. 295. nization may be of a charitable nature. (Sec. 170, constitute allowable deductions. §§39.23(o)-1, 39.23(q)–1. (Secs. 23(o). 23(o). ’39 Code; Sec. 80.144 Indian tribal governments; treated as ’86 Code.) Rev. Rul. 56-329, 1956-2 C.B. 125. 170, ’86 Code.) states or political subdivisions. Rev. Rul. Rev. Rul. 54-532, 1954-2 C.B. 93. 58-610, Rev. Rul. 68-231 and Rev. Rul. 74-170 80.129 Fund-raising organization. Contribu- are suspended as to their respective applications to tions to an exempt organization whose principal 80.137 Home for aged; life care payment. A Indian tribes, or subdivisions thereof during the purpose and function is the raising of funds needed taxpayer may not claim a charitable contribution specified two years under section 7871 of the by public agencies and hospitals for the care of deduction for any part of a lump sum payment Code. §§1.61-7, 1.103-1, 1.170A-1, 305.7871-1. crippled children and which also, as a secondary made to a religious home for the aged for the care (Secs. 61,103,170, 2055, 4041,4221, 4253, 4483, activity, operates a medical treatment center, do of his father where such payment is based on the 7871; ’86 Code.) not qualify for the additional deduction provided life expectancy of his father and he dies within his Rev. Rul. 84–93, 1984–1 C.B. 279. by section 170(b)(1)(A). §1.170-2. (Sec. 170, ’86 life expectancy. However, he may be entitled to a dependency exemption for his father. (Sec. 170, 80.145 Industrial commission. An industrial Code.) ’86 Code.) commission, established by a state legislature to Rev. Rul. 59–27, 1959-1 C.B. 57. Rev. Rul. 58-303, 1958-1 C.B. 61. study the problems of industrial life in a particular 80.130 Funds transferred for investment; geographic area, is composed of representatives retained right to income. A taxpayer who trans- 80.138 Homeowners association. A nonprofit appointed by elected officials from each partici- fers funds to a charitable organization for invest- organization formed to preserve the architecture pating mumcipality, and is authorized to provide ment with income required to be accumulated and appearance of a housing development, and to for the housing of industries, acquire land, borrow until he is age 65 and then paid to him for life and own and maintain common green areas, streets, money, sell property, issue revenue bonds, and then to his wife for life has made a deductible char- and sidewalks for use of all the development resi- establish a per capita assessment. Its activities are itable contribution to the organization. The dents qualifies for exemption; however, contribu- subject to review by the state and member munici- amount of the contribution is determined by multi- tions to the organization are not deductible. Rev. palities. Amounts contributed to the commission plying the sum transferred by the appropriate actu- Rul. 69-280 distinguished. are deductible charitable contributions. §§1.170-2, arial factor. Prior to the taxpayer’s attainment of 1.501(c)(4)-1. (Secs. 170, 501; ’86 Code.) §1.170A-1. (Sec. 170, ’86 Code.) age 65, or prior to the taxpayer’s wife attaining age Rev. Rul. 72-102, 1972-1 C.B. 149. Rev. Rul. 79-323, 1979-2 C.B. 106. 65 should the taxpayer predecease her, no income 80.146 Influencing legislation. A deduction is for the invested funds will be taxable to them. 80.139 Honorarium; transferred to educa- not allowable for amounts paid to an organization §1.170-2. (Sec. 170, ’86 Code.) tional organization. The amount of an honorar- exempt from tax under section 501(c)(3) and Rev. Rul. 69–312, 1969–1 C.B. 64. ium payable to an elected federal official, but described in section 170(c)(2) that are earmarked transferred at the official’s request to an educa- for use in, or in connection with, influencing spe- 80.131 Future interest in tangible personal tional organization selected by the payer from a cific legislation. §§1.170A-1, 1.501(a)-1. (Secs. property. A charitable contribution consisting of list of five charitable organizations provided by 170, 501; ’86 Code.) a future interest in tangible personal property the official, is includible in gross income under Rev. Rul. 80-275, 1980-2 C.B. 69. made before July 1, 1964, is deductible at the time section 61, even though treated as not being the gift is made where the deed of gift or other accepted by the official for purposes of 2 U.S.C. 80.147 Installment notes credited as gifts. An instrument of transfer contains a provision which 44li. However, the amount is deductible as a chari- installment basis taxpayer is taxable on install- provides for the forfeiture or termination of the table contribution subject to the limitations of sec- ment notes due from the sale of realty to an exempt reserved life interest on its termination or tion 170.§§1.61–2, 1.170A-1. (Secs. 61, 170; ’86 educational organization when the notes are cred- attempted alienation. §1.170-1. (Sec. 170, ’86 Code.) ited to the organization as gifts; however, the fair Code.) Rev. Rul. 79-121, 1979-1 C.B. 61. market value of each note as of the date it is cred- Rev. Rul. 65–20, 1965–1 C.B. 124. ited as a gift will constitute an allowable charitable 80.140 Hospital association; use by donor’s deduction. §§39.23(0)-1, 39.44-5. (Secs. 23(o), 80.132 Gifts to city; relocation of railroad 44, ’39 Code; Secs. 170,453, ’86 Code.) facilities. Contributions and gifts to a city to be employees. Payments by a corporation to a hospi- tal association, under an agreement which fur- Rev. Rul. 55–157, 1955-1 C.B. 293. used to provide railroad companies with substitute facilities in consideration for removing their nished the taxpayer with particular rights and 80.148 Insurance policy; assigned to charita- tracks and stations from the central portion of the interests for its employees for a period of ten years ble foundation. A corporation that assigns to a city and relinquishing their right-of-way through in certain properties and facilities of a hospital to charitable organization life insurance policies the city are deductible as charitable contributions. be constructed, are not deductible as charitable payable to itself or its successors or assigns on the §1.170-1. (Sec. 170, ’86 Code.) contributions or as business expenses, but consti- same day that initial premiums were paid, may Rev. Rul. 67-446, 1967-2 C.B. 119. tute capital expenditures. §§39.23(a)-1, deduct an amount equal to the initial premium as 39.23(q)-1, 39.24(a)-2. (Secs. 23(a), 23(q), 24(a), a charitable contribution. §1.170–1. (Sec. 170, ’86 80.133 Government educational organiza- ’39 Code; Secs. 162, 170, 263, ’86 Code.) Code.) tions and hospitals. Contributions to governmen- Rev. Rul. 55-616, 1955-2 C.B. 545. Rev. Rul. 58–372, 1958–2 C.B. 99. tal instrumentalities for the expansion, develop- ment or creation of government operated 80.141 Improvements to Government-owned 80.149 Insurance policy; irrevocably educational organizations and hospitals qualify housing. The amount expended by a tenant for assigned to college. The irrevocable assignment for the additional charitable deduction. (Sec. 170, additions or improvements to Government-owned of the cash surrender value of a life insurance ’86 Code.) housing is not deductible as a charitable contribtr- policy to a college with the donor retaining the Rev. Rul. 55–453, 1955–2 C.B. 54. tion. Such amount represents a nondeductible per- right to designate the beneficiary and to assign the sonal, living or family expense. §§1.170–1, balance of the policy, whether the policy is paid-up 80.134 Governors’ conference. Money 1.262-1. (Secs. 170, 262; ’86 Code.) and the college is given possession or the policy is donated to a State by an individual to defray Rev. Rul. 67-14, 1967-1 C.B. 61. nonpaid-up and the donor retains possession, Charitable contributions constitutes a charitable contribution of a partial subsequently conveyed in fee to another charita- of section 170(f)(3)(B)(i) and (ii) and may be interest under section 170(f)(3) for which a deduc- ble organization is the fair market value of the deducted as a charitable contribution. tion is not allowable. A deduction is likewise not actual land conveyed. Rev. Rul. 73–339 clarified. §1.170(A)-7. (Sec. 170, ’86 Code.) allowable for the amount of the increase in cash §1.170A-1. (Sec. 170, ’86 Code.) Rev. Rul. 75-420, 1975–2 C.B. 78. surrender value attributable to the annual pre- Rev. Rul. 76-376, 1976-2 C.B. 53. mium paid by the donor on the nonpaid-up policy. 80.163 Involuntary conversion; replacement Rev. Ruls. 69–79 and 69–215, to the contrary, 80.156 Interests in property; retained life property. Gain previously unrecognized upon the revoked for gifts made after July 31, 1969. estate; leased farmland.A retired farmer, a por- involuntary conversion of a taxpayer’s property §1.170A-7. (Sec. 170, ’86 Code.) tion of whose farm is leased to an unrelated third will not be recognized upon the contribution of the Rev. Rul. 69-79, 1969-1 C.B. 63; Rev. Rul. party, may deduct as a charitable contribution a replacement property to a charitable organization. 69-215, 1969-1 C.B. 63; Rev. Rul. 76-143, gift not in trust to an exempt educational organiza- §1.1033(a)-1. (Sec. 1033; ’86 Code.) 1976-1 C.B. 63. tion of an irrevocable unrestricted remainder Rev. Rul. 68-292, 1968-1 C.B. 359. interest in a portion of the leased land in which the 80.150 Intangible drilling and development farmer retains a life estate. §1.170A-7. (Sec. 170, 80.164 Joint bank account of two exempt cost property. The taxpayer donated to an educa- ’86 Code.) organizations. Contributions to the joint bank tional institution certain items obtained in the Rev. Rul. 78-303, 1978-2 C.B. 122. account of two qualified exempt organizations course of drilling oil and gas wells. The items engaged in a joint fund raising campaign are con- come within the definition of ordinary income 80.157 Interests in property; retained min- sidered to have been made to the organizations and property in section 1.170A-4(b)(1). The taxpayer eral or lease rights. The donation of real property are, therefore, subiect to the additional ten percent previously deducted the costs of obtaining the to a charitable organization with the donor retain- deduction. §1.170-2. (Sec. 170, ’86 Code.) items as intangible drilling and development costs ing the mineral rights, including the sole right to Rev. Rul. 66-304, 1966-2 C.B. 98. and has a zero basis in them. Therefore, the tax- exploit and sell the minerals obtained, or the donor payer’s charitable contribution deduction is zero. retaining a lifetime interest in payments due under 80.165 Limitation; health care service; home , §§1.170A-4, 1.612-4, 1.1212-1, 1.1231-1. (Secs. a 60-year timber lease executed the previous year treatment. An exempt organization primarily 170, 612, 1221, 1231; ’86 Code) is not a contribution of an undivided portion of the providing health services to sick persons in their Rev. Rul. 82-9, 1982-1 C.B. 39. donor’s entire interest in the property and no own homes under the direction of their private deduction therefor is allowable. §1.170A-1. (Sec. physicians and providing only incidental patient 80.151 Interests in property; easement of 170, ’86 Code.) treatment at the organization’s office, which is not beachfront property to county.A taxpayer who Rev. Rul. 76-331, 1976-2 C.B. 52. equipped to serve as an outpatient facility on a contributed an easement in perpetuity in a 50 acre continuing basis, does not qualify as a hospital as tract of vacant beachfront property to a county, 80.158 Interests in property; retained right to defined in section 170(b)(j)(A)(iii). §1.170A-9. retaining mineral rights, the right of access to open use. The contribution of a tract of land to the U.S. (Sec. 170, ’86 Code.) water, and usable channel through the property to by an individual who retained the right during his Rev. Rul. 76-452, 1976-2 C.B. 60. adjacent land, and who remains responsible for lifetime to train his personal hunting dog on the 80.166 Limitation; installment note. A con- property taxes, levies, and assessments, has con- trails extending over-the entire tract is deductible. tribution to a charitable organization of an install- tributed an open space easement and is entitled to §1.170A-7. (Sec. 170, ’86 Code.) ment note that was obtained as a result of a section a charitable contribution deduction for the value of Rev. Rul. 75-66, 1975-1 C.B. 85. 453 installment sale of section 1231 property is an the restricted easement. §1.170A-7. (Sec. 170, ’86 Code.) 80.159 Interests in property; retained timber allowable deduction subject to the 50 percent Rev. Rul. 75-373, 1975-2 C.B. 77. or mineral rights. A gift of timber land to a chari- limitation contained in section 170(b)(1)(A) and is table organization for transfer to the U.S. for use not subject to the special limitations of section 80.152 Interests in property; effect on earn- as a wildlife preserve is not disallowed under sec- 170(b)(1)(D). §1.170A-1. (Sec. 170, ’86 Code.) ings and profits. The Service will not follow the tion 170(f)(3)(A) by the grantor’s retention of Rev. Rul. 74-336, 1974-2 C.B. 80. Jacob M. Kaplan decision concerning a corpora- mineral or timber rights that can be exercised only 80.167 Limitation; net income redetermined. tion that makes a charitable contribution of appre- upon the remote possibility of approval of the Where a corporation’s net income has been rede- ciated property. The corporation may reduce its Government. §1.170A-1. (Sec. 170, ’86 Code.) termined, due to renegotiations of Government current earnings and profits only by the adjusted Rev. Rul. 77-148, 1977-1 C.B. 63. contracts, the charitable deduction is limited to basis of the donated property, even though in com- puting its taxable income it may deduct an amount 80.160 Interests in property; scenic easement five percent of net income after renegotiation. I.T. equal to the property’s fair market value. (Sec. 170, to state. An enforceable easement in perpetuity, 3733 superseded. §1.170-3. C.B. 96. ’86 Code.) Rev. Rul. 71-78, 1971-1 §§1.170A-1, 1.312-1. (Secs. 170, 312; ’86 Code.) contributed to a state by the owner of a mansion Rev. Rul. 78-123, 1978-1 C.B. 87; Jacob M. declared to be a state landmark, restricting the 80.168 Limitation; remainder trust; alter- Kaplan, 43 T.C. 580, Nonacq., 1978-1 C.B. 2. right of the owner to subdivide, mine, or indus- nate beneficiary. A taxpayer created a charitable trially develop the property or to alter the appear- remainder trust with the remainder interest pay- 80.153 Interests in property; open space ease- ance or modify the architectural characteristics of able to a public university described in section ment. An individual who granted a 30-foot wide the residence, is a scenic easement and an open 170(b)(1)(A)(ii) and (c)(2)(B). The trust instru- open space easement in gross in perpetuity along space easement within the meaning of reg. ment provides that if the university is not an orga- the edge of his property, a capital asset held more 1.170A-7(b)(1)(ii). The owner is entitled to a char- nization described in section 170(c) when the trust than SIX months, to a foundation described in sec- itable contribution deduction in the manner and to is to be distributed, the trustee will then select a tion 170(c)(2) that was not a private foundation the extent provided in section 170 of the Code for beneficiary described in section 170(c). The possi- described in section 509(a), may deduct the fair the fair market value of the easement. §1.170A-7. bility that the remainder will not go to an organiza- market value of the easement to the extent and (Sec. 170, ’86 Code.) tion described in section 170(b)(1)(A) is so remote manner provided under section 170. §1.170A-1. Rev. Rul. 75-358, 1975-2 C.B. 76. as to be negligible, and the 50 percent limitation is (Sec. 170, ’86 Code.) applicable with respect to the taxpayer’s transfer Rev. Rul. 74-583, 1974-2 C.B. 80. 80.161 Interests in property; undivided por- to the trust. §§1.170A-8, 1.664-1. (Secs. 170, 664; tion. Application of reg. 1.170A-7(b)(1) with ’86 Code.) 80.154 Interests in property; open space ease- respect to contributions made before October 4, Rev. Rul. 80-38, 1980-1 C.B. 56. ment; valuation. A gratuitous contribution of an 1972, of an undivided portion of a donor’s entire open space or scenic easement in perpetuity with- interest in property. §1.170A-7. (Sec. 601.105, 80.169 Limitation; school, church, or hospi- out expectation of economic benefit to the donor S.P.R.; Sec. 170, ’86 Code.) tal as secondary activity. Contributions to an is a deductible charitable contribution and, if not Rev. Proc. 72-45, 1972-2 C.B. 826. organization whose activities are educational, separately and distinctly valued, the value of the religious, or charitable in the broad sense of those gift may be determinable according to the “before 80.162 Interests in property; undivided por- words, and which maintains a school, church, or and after” approach. Clarified by Rev. Rul. tion. A taxpayer contributed improved real prop- hospital as a secondary or incidental activity qual- 76-376. §1.170A-1 (Sec. 170, ’86 Code.) erty, used only for summer vacations, to an orga- ify as a deduction only to the extent of the 20 per- Rev. Rul. 73-339, 1973-2 C.B. 68. nization described in section 170(c)(2). The deed cent limitation. Rev. Rul. 55–219 revoked. (Sec. of gift reserved to the donor the right to free and 170, ’86 Code.) 80.155 Interests in property; open space ease- exclusive use of the property each summer and to Rev. Rul. 56-262, 1956-1 C.B. 131. ment; valuation. The fair market value of an open store personal belongings in the main residence space easement in perpetuity in a portion of a tax- year-round, and prohibited the organization from 80.170 Limitation; support received from payer’s land, granted to a charitable organization making changes to the property without the publicly supported churches. The two percent described in section 170(c), is the difference donor’s consent and conveying the property until limitation prescribed by reg. 1.170A-9(e)(6)(i) between the fair market value of the entire tract of the later of the donor’s death or 10 years after the does not apply to the support received by an land before and after the granting of the easement. gift. The contribution qualifies as a gift of a exempt organization described in section The fair market value of the taxpayer’s remaining remainder interest in a personal residence and an 170(c)(2) from individual churches described in interest in the land encumbered by the easement undivided interest in property within the meaning section 170(b)(1)(A)(i) that are publicly sup- Charitable contributions ported and entitled to section 170(b)(1)(A)(vi) sta- 80.178 Membership dues. Guides are pres- tion in any amount is made. §§1.170–2, 1.172–1. tus. §1.170A-9. (Sec. 170, ’86 Code.) ented for determining whether membership dues (Secs. 170, 172; ’86 Code.) Rev. Rul. 78-95, 1978-1 C.B. 71. paid to an organization described in section Rev. Rul. 64-172, 1964-1 (Part 1) C.B. 118. 170(c)(2) may be deducted, in whole or in part, as 80.171 Limitation; voluntary association of a charitable contribution. Rev. Rul. 54–565 modi- 80.185 Newspaper space. A donation of space fied. §1.170-1. (Sec. 170, ’86 Code.) by a newspaper to an organization to which chari- counties. Contributions to a voluntary association table contributions can be made is not a gift of of counties separate from, but qualifying as a Rev. Rul. 68-432, 1968-2 C.B. 104. property but is a rendition of services. The fair wholly owned instrumentality of, its member market value of the donated space does not qualify counties and organized and operated exclusively 80.179 Membership dues; portion distrib- for public purposes will not qualify for the 50 per- uted to charity. The portion of membership dues as a deductible contribution or gift of property. cent limitation under section 170(b)(1)(A) but are marked for distribution to qualified charities and (Sec. 170, ’86 Code.) paid to a social club’s treasurer, who is also the Rev. Rul. 57-462, 1957–2 C.B. 157. deductible charitable contributions subiect to the 20 percent limitation of section 170(b)(1)(B). authorized agent of the donee organizations, is 80.186 Numismatic society performing §1.170A-8. (Sec. 170, ’86 Code.) deductible by the payor as a charitable contribu- educational activities. The additional deduction Rev. Rul. 75–359, 1975–2 C.B. 79. tion when paid to the treasurer. However, if the of ten percent of adjusted gross income does not treasurer were not an agent of the charitable orga- apply to the charitable contributions or gifts made 80.172 Locomotive transferred to municipal- nizations, the contributions would be deductible by individuals to an organization where its princi- ity; trust relationship. A railroad transferred a only in the year actually transferred to the donee pal purpose and functions are devoted to the retired locomotive pursuant to an agreement organizations. §39.23(o)-1. (Sec. 23(o), ’39 collection and preservation of coins and medals, whereby the locomotive would be held in trust by Code; Sec. 170, ’86 Code.) with secondary activities consisting of the further- a civic association for public display as an histori- Rev. Rul. 55–192, 1955-1 C.B. 294. ance of the organization’s educational aims in cal exhibit in a city park, Held, the railroad is graduate and post-graduate study of numismatics entitled to a charitable deduction for the transfer. 80.180 Military Affiliate Radio System; out- and related fields. Distinguished by Rev. Rul. (Sec. 170, ’86 Code.) of-pocket expenses. Unreimbursed out-of-pocket 81-79. (Sec. 170, ’86 Code.) Denver and Rio Grande Western Railroad Co., expenses incurred by a civilian ham operator in Rev. Rul. 58-433, 1958-2 C.B. 102. 38 T.C. 557, Acq., 1963-1 C.B. 4. operating his radio equipment as a volunteer mem- ber of the supplemental program of the Military 80.187 Oil, gas, and minerals in place; rever- 80.173 Lodging and transportation acquired Affiliate Radio System (MARS), an organization sionary interest. A transfer by deed of oil, gas and by barter. A radio station that donates to an of military radio stations and facilities established minerals in place to a church until it received a agency of the U.S. Government its right to use of at U.S. Army and Air Force. installations, are stated sum from production was a gift, and its fair lodging and transportation acquired from hotels deductible as charitable contributions or gifts. market value at transfer was a deductible contribu- §1.170-2. (Sec. 170, ’86 Code.) tion in the year transferred even though payments and airlines in exchange for radio advertising time were not available until the following year. (Sec. may deduct, under section 170, the fair market Rev. Rul. 67-364, 1967-2 C.B. 120. 23(o), ’39 Code; Sec. 170, ’86 Code.) value of the rights donated, Rev. Ruls. 57-462 and Lester A. Nordan, 22 T.C. 1132, Acq. in result, 67-236 distinguished. §1.170A-1. (Sec. 170, ’86 80.181 National Guard. A National Guard offi- cer is not entitled to an expense deduction for 1959-1 C.B. 4. Code.) expenditures for maintaining morale, entertaining 80.188 Oil and gas lease; overriding royalty Rev. Rul. 841, 1984-1 C.B. 39. prospective members, etc., which have not been or net profits interest. The owner of a working authorized as a regular expense payable by the interest under an oil and gas lease is not entitled to 80.174 Lump sum payment; organization U.S. Army. Expenditures made in compliance acting as agent. Contributions to national volun- with Army regulations respecting the making of a charitable contribution deduction under section 170(a) of the Code for the contribution of an over- tary health agencies made, in a lump sum and with contributions to company funds, if such expenses riding royalty interest or a net profits interest. designated specific amounts for agencies of the are incurred for exclusively public purposes, are §1.170A-7. (Sec. 170, ’86 Code.) donor’s choice, to an organization soliciting con- deductible under section 23(o)(1) of the ’39 Code. tributions in Federal offices are deductible. (Sec. §39.23(a)-1. (Sec. 23(a), ’39 Code; Sec. 162, ’86 Rev. Rul. 88-37, 1988-1 C.B. 97. 170, ’86 Code.) Code.) 80.189 Oil and gas lease; undivided interest. Rev. Rul. 57-287, 1957–2 C.B. 157. Rev. Rul. 55-201, 1955-1 C.B. 269. The fair market value of an undivided interest in oil and gas leases donated to a charitable organiza- 80.175 Marriage seminar. Participants in a 80.182 National war veterans organization; tion is deductible by the donor and is not includable weekend marriage seminar conducted by a chari- endowment fund. Contributions to an endow- in his gross income, nor is the amount of the con- table organization are not entitled to a charitable ment fund established by an exempt national war tribution reduced by the intangible drilling and contribution deduction for any part of a donation veterans organization for the care of disabled war development costs previously deducted by the made to the organization at the conclusion of the veterans or orphans of war veterans, some of donor. §1.170-1. (Sec. 170, ’86 Code.) seminar unless the participants establish that the whom may be members of the organization, may Rev. Rul. 59–196, 1959–1 C.B. 56. amount donated exceeds the monetary value of all be deducted as charitable contributions. I.T. 2139 benefits and privileges received and that the superseded. §1.170A-1. (Sec. 170, ’86 Code.) 80.190 Oil pollution control fund. Voluntary amount claimed as a charitable contribution is the Rev. Rul. 73–14, 1973-1 C.B. 117. contributions to a city’s special oil pollution con- amount of such excess. §1.170A-1. (Sec. 170, ’86 trol fund used for research, beautification, and Code.) 80.183 Net operating loss carryover; effect of advertising to recover tourist business lost due to Rev. Rul. 76-232, 1976-1 C.B. 62. contribution carryover. In computing its net oil pollution and that is commensurate with the operating loss carryover to the following year, a expected financial return are not deductible as 80.176 Medical research organization; prof- corporation is required to take into account chari- charitable contributions but are deductible as busi- it-making hospital. The additional ten percent table contributions carried over from the preced- ness expenses by a corporation conducting a retail deduction is not applicable to contributions made ing year and combine them with the charitable business in the city. Rev. Rul. 69–90 distin- to a medical research organization which operates contributions actually made during the current guished. §§1.162-15, 1.170A-1. (Secs. 162, 170; in conjunction with a hospital operated for profit. year. However, the contributions so taken into ’86 Code.) §1.170-1. (Sec. 170, ’86 Code.) account can not be carried over to the following Rev. Rul. 73–113, 1973–1 C.B. 65. Rev. Rul 66–245, 1966–2 C.B. 71. year since they served to reduce the taxable 80.191 Oklahoma Educational Television income for the current year and thereby increased Authority. Contributions or gifts to the Oklahoma 80.177 Membership dues. Membership dues, the net operating loss carryover. §§1.170A-11, Educational Television Authority, an instrumen- paid to a charitable organization, which do not 1.172-5. (Secs. 170, 172; ’86 Code.) tality of Oklahoma, are deductible. §§39.23(o)-1, entitle the member to any benefits or privileges in Rev. Rul. 76-145, 1976-1 C.B. 68. 39.23(q)-1. (Secs. 23(o), 23(q), ’39 Code; Sec. return, are deductible as charitable contributions; 170, ’86 Code.) however, where the payment entitles the member 80.184 Net operating loss carryover taken Rev. Rul. 54-11, 1954-1 C.B. 64. to certain benefits or privileges, such dues are not into account. For purposes of the unlimited chari- deductible as charitable contributions, but may table contribution deduction for certain individu- 80.192 Option granted on real property; year represent a deductible business expense. Modified als under section 170(b)(l)(C), (1) a net operating deductible. An individual who grants an option on by Rev. Rul. 68–432 to indicate that the payment loss deduction for a taxable year attributable to net real property to a charitable organization is of such dues is deductible as a charitable contribu- operating loss carryovers is taken into account in allowed a charitable deduction for the year in tion to the extent the payment exceeds the mone- determining taxable income with respect to such which the organization exercises the option in the tary value of the benefits and privileges available year; and (2) the ninety percent of taxable income amount of the excess of the fair market value of the by reason of such payment. §§39.23(a)-5, requirement will be satisfied if in any of the eight property on the date the option was exercised over 39.23(o)-1, 39.23(q)-1. (Secs. 23(a), 23(o), of the ten preceding years in which taxable income the exercise price. §1.170A-1. (Sec. 170, ’86 23(q), ’39 Code; Secs. 162, 170, ’86 Code.) computed in accordance with such section is Code.) Rev. Rul. 54-565, 1954-2 C.B. 95. reduced to or below zero and a charitable contribu- Rev. Rul. 82-197, 1982-2 C.B. 72. Charitable contributions 80.193 Organization for maintenance of 80.201 Payment after close of taxable year. 80.209 Plans for Progress; Vocational Guid- exclusive private community. Contributions to a Where, during the taxable year, a board of direc- ance Program. Contributions made to Plans for nonprofit organization that provides care and tors authorized a contribution, and such contribu- Progress for its Vocational Guidance Program are maintenance for an exclusive private residential tion was paid after the close of the taxable year and deductible as contributions for the use of the U.S. community are not deductible as charitable con- on or before the fifteenth day of the third month for exclusively public purposes. §1.170–1. (Sec. tributions. §1.170-1. (Sec. 170, ’86 Code.) following the close of the taxable year, an election 170, ’86 Code.) Rev. Rul. 68-485, 1968-2 C.B. 107. may be made in its return by an accrual basis cor- Rev. Rul. 67-298, 1967–2 C.B. 111. poration to treat all or only a portion of the con- 80.194 Organization promoting legislation tribution as paid during the taxable year. (Sec. 80.210 Pledge. Under certain circumstances, a for humane treatment of animals.An organiza- 23(q), ’39 Code; Sec. 170, ’86 Code.) taxpayer may be permitted the “special deduc- tion operated for the prevention of cruelty to ani- Rev. Rul. 57-228, 1957-1 C.B. 506. tion” for contributions, even though his contribu- mals, exempt under section 501(c)(4), is not tion is not made direct to an organization of the exempt under section 501(c)(3) if it substantially 80.202 Payment to city for parking facilities; type specified in section 170(b)(1)(A), as where a engages in promoting legislation for the humane merchants and property owners. Voluntary pay- check is made payable to such an organization but treatment of animals, even though the legislation ments by merchants and property owners to a city delivered to a fund-raising foundation in satisfac- it advocates may be beneficial to the community, to provide unrestricted public parking facilities in tion of a pledge. (Sec. 170, ’86 Code.) and even though most of its attempts to influence the general area of the businesses and properties of Rev. Rul. 55-1, 1955–1 C.B. 26. legislation may be indirect. Contributions to it are the contributors are charitable contributions. Dis- 80.211 Pledge; satisfied with appreciated or not deductible. §§1.170-2, 1.501(c)(3)-1, tinguished by Rev. Rul. 73–113. §1.170-1. (Sec. depreciated property. The satisfaction of a 1.501(c)(4)-1. (Secs. 170, 501; ’86 Code.) 170, ’86 Code.) pledge to an organization described in section Rev. Rul. 67–293, 1967-2 C.B. 185. Rev. Rul. 69-90, 1969-1 C.B. 63. 23(o) of the ’39 Code by means of a donation or gift of property which has either appreciated or 80.195 Organization to improve welfare of 80.203 Payment to pension fund adminis- depreciated in value does not give rise to a gain or research animals. Deductible contributions made tered by church; clergymen. Payments made by loss. Such contribution is deductible to the extent by individuals to a qualified charitable organiza- clergymen to a pension fund administered by a of the fair market value at the time of the contribu- tion whose primary purpose is to improve the wel- church for their benefit, or for the benefit of their tion or gift. Note: For taxable years beginning after fare of animals held for medical research are lim- widows and dependent children, are not deduct- ited to 20 percent of the donor’s adjusted gross 1969, see §201, Pub.L. 91–172, 1969-3 ible as charitable contributions to the church, Such §39.23(o)-1. (Sec. 23(o), ’39 Code; Sec.C.B. 45. 170, ’86 income. §1.170–2. (Sec. 170, ’86 Code.) payments constitute nondeductible personal Code.) Rev. Rul. 58–263, 1958–1 C.B. 146. expenses. §1.170–1. (Secs. 170, 262; ’86 Code.) Rev. Rul. 55–410, 1955-1 C.B. 297. Rev. Rul. 58-264, 1958-1 C.B. 144. 80.196 Pacific War Memorial Commission. 80.212 Pledged securities donated to charita- Contributions, gifts, legacies, bequests, devises, 80.204 Payments to charitable organizations ble organization. A donation to a charitable orga- or transfers to the Pacific War Memorial Commis- by travel agent. A travel agent regularly trans- nization of appreciated securities, which have sion, an agency of the Territory of Hawaii, are acted a substantial business with tax exempt orga- been held for more than six months and are deductible. §§39.23(o)-1, 39.23(q)-1. (Secs. nizations. Rather than promote such business pledged as collateral for an outstanding loan that 23(o), 23(q), ’39 Code; Sec. 170, ’86 Code.) through salesmen and advertising, the agent made is in excess of the donor’s basis, constitutes partly Rev. Rul. 54-220, 1954-1 C.B. 65. voluntary annual cash payments to the organiza a sale and partly a gift. Therefore, the donor real- tions based on the amount, character and profit- izes a long-term capital gain of the difference ability of their business.Held, the payments were between the amount of the loan and his basis in the 80.197 Paid as condition of probation. An made solely for business purposes; the limitation amount paid to a charitable organization in satis- securities. He is also entitled to a charitable con- on charitable deductions did not preclude deducti- tributions deduction in the amount of the excess of faction of a condition of probation imposed by a bility in full as a business expense. (Secs. 162, federal district court is not paid gratuitously and is the fair market value of the securities over the 170; ’86 Code.) loan. §§1.61–6, 1.170-1, 1.1001–1. (Secs. 61, not deductible under section 170. §§1.162–21, Sarah Marquis, 49 T.C. 695, Acq., 1971-2 C.B. 1.170-1. (Secs. 162, 170; ’86 Code.) 170, 1001; ’86 Code.) 3. Rev. Rul. 70-626, 1970-2 C.B. 158. Rev. Rul. 79-148, 1979-1 C.B. 93. 80.205 Payments to TRANSPO. Payments to 80.213 Police department; reward money 80.198 Partnership interest; unrealized the 1972 U.S. Transportation Exposition contributed by murder victim’s parent.A con- receivables. A transferor by way of a charitable (TRANSPO) maybe deductible as charitable con- tribution of reward money by a parent of a mur- contribution of an interest in a partnership appur- tributions or as a business expense, depending dered individual to the police department of a tenant to which is a right to share in unrealized upon the facts and circumstances in each case. political subdivision for information leading to the partnership income reflected in partnership §§1.162-15, 1.170-3. (Secs. 162, 170; ‘86 Code.) conviction of the murderer is for exclusively pub- installment obligations, is allowed a deduction as Rev. Rul. 72-293, 1972-1 C.B. 95. lic purposes and is deductible under section 170. a charitable contribution of the fair market value, §1.170A-1. (Sec. 170, ’86 Code.) as of the date of the transfer, of that portion of the80.206 People-to-People Program. Contribu- Rev. Rul. 81-307, 1981-2 C.B. 78. partnership interest which is exclusive of the tions made to certified committees organized to installment obligations receivable and is regarded carry out the “People-to-People Program” spon- 80.214 Political campaign funds transferred as a capital asset, and the fair market value, as of sored by the United States Government and out- to U.S. Government. The transfer to the U.S. such date, of the partnership installment obliga- of-pocket expenses incurred by individuals in ren- Government of unexpended political funds tions regarded as disposed of in the transfer. dering services for the promotion of such impractical to be returned to the contributors, by §1.170-1. (Sec. 170, ’86 Code.) committees are deductible charitable contribu- a campaign committee organized and operated to Rev. Rul. 60-352, 1960-2 C.B. 208. tions. Supplemented to certify certain committees influence the election of an individual to a Federal for designated taxable years by Rev. Rul. 65-288, public office, is an expenditure to carry out the 80.199 Patent interest. The fair market value of 1965-2 C.B. 55; Rev. Rul. 66-202, 1966-2 C.B. purpose of the committee and not a diversion for an interest in a patent donated to a tax-exempt 70; Rev. Rul. 66-244, 1966-2 C.B. 71; Rev. Rul. the personal benefit of the candidate or other per- organization by the owner of the patent is deduct- 67-324, 1967-2 C.B. 112. §1.170-1. (Sec. 170, son. Such transfer does not give rise to gross ible as a charitable contribution in the taxable year ’86 Code.) income to the candidate, committee, or any of its such property is transferred. Any royalties paid to Rev. Rul. 57-38, 1957-1 C.B. 96. members; is not subject to the gift tax; and does not the tax-exempt organization as a result of the entitle tbe candidate, committee, or any of its transfer constitutes income to the organization. 80.207 People-to-People Program; foreign members, or any contributor to a charitable con- (Sec. 170, ’86 Code.) travel tours. Expenses incurred on foreign travel tribution deduction. Rev. Rul. 71–449 clarified. Rev. Rul. 58-260, 1958-1 C.B. 126. tours sponsored by travel agencies are not deduct- §§1.61-1, 1.170A-1. (Secs. 61, 170; ’86 Code.) ible as contributions to or for the use of the U.S. in Rev. Rul. 74-22, 1974-1 C.B. 16. 80.200 Payment after close of tax year; elec- exclusively advancing the “People-to-People 80.215 Pooled income funds; sample forms. tion. An accrual method corporation made a Program”. §1.170-1. (Sec. 170, ’86 Code.) The purpose of this revenue procedure is to make proper election to deduct a charitable contribution Rev. Rul. 64-216, 1964-2 C.B. 63. available a sample form of declaration of trust and authorized by the board of directors during the tax instruments of transfer that meet the requirements year and paid within 2 1/2 months after the close 80.208 Pew rents; building fund assessments; for a pooled income fund as described in section of the tax year even though the corporation failed periodic dues. Pew rents, building fund assess- 642(c)(5). §§1.170A-6, 1.642c-5. (Sec. 601.201, to attach to the tax return the declaration and reso- ments, and periodic dues are methods of making S.P.R.; Secs. 170, 642, 2055, 2522, ’86 Code.) lution required by reg. 1.170-3(b). (Sec. 170, ’86 contributions to a church and are deductible as Rev. Proc. 88-53, 1988-2 C.B. 712. Code.) charitable contributions. A.R.M. 2 superseded. Columbia Iron & Metal Co., 61 T.C. 5, Acq., §1.170-1. (Sec. 170, ’86 Code.) 80.216 Portrait fund. Contributions to a fund 1979-2 C.B. 1. Rev. Rul. 70-47, 1970-1 C.B. 49. formed solely to acquire and display a portrait of Charitable contributions a judge in the courthouse of a political subdivision 80.224 Qualified appraisal; closely held cor- as agents of the order, for work performed outside are deductible under section 170. §1.170A-1. porations and personal service corporations. the religious community and paid over, in full or (Sec. 170, ’86 Code.) The requirement for a qualified appraisal from a part, to the order at its direction, are includible in Rev. Rul. 81-219, 1981-2 C.B. 77. third party in the case of certain charitable con- the gross incomes of the members and are wages tributions of property by closely held corporations subject to the FICA and income tax withholding. 80.217 Private racially discriminatory and personal service corporations will be waived However, the individual members are entitled to schools. Private schools that practice racial dis- under final regulations to be issued under section charitable contribution deductions for amounts crimination do not qualify as tax-exempt orga- 170(a)(1) of the Code. remitted to the order. Clarified by Rev. Rul. nizations under section 501(c)(3). Contributions Notice 89-56, 1989-1 C.B. 698. 77-290. §§1.61-2, 1.170A-1. (Secs. 61, 170, to such schools are not deductible under section 3121, 3401; ’86 Code.) 170. (Secs. 170, 501; ’86 Code.) 80.225 Realty; purchase price from donor. A Rev. Rul. 76-323, 1976–2 C.B. 18. Bob Jones University, 461 U.S., Ct. D. 2018, railroad corporation’s contribution of cash equal 1983-2 C.B. 80. to the fair market value of improved property to an 80.233 Religious order; vow of poverty mem- organization described in section 170(c)(2), and ber’s trust income remitted to order. Trust 80.218 Public park. Contributions made to a the organization’s payment of this amount to the income, the assignment of which is prohibited by committee to be used in developing land donated railroad to “purchase” the facility constitutes a the trust instrument and state law, is includable in to a political subdivision as a public park are charitable contribution of property in an amount the gross income of a trust income beneficiary deductible by the donor. §§39.23(o)-1, determined under section 170(e). The annual pay- who joined a religious order, took a vow of pov- 39.23(q)–1. (Secs. 23(o), 23(q), ’39 Code; Sec. ment made by the railroad to the organization for erty, and, pursuant to the vow, turned over all pay- 170, ’86 Code.) specified operating expenses in consideration for ments from the trust to the order. The amount Rev. Rul. 54-466, 1954-2 C.B. 93. making the facilities available for the use of its turned over to the order is deductible as a charita- employees is a deductible business expense. ble contribution. §§1.61-1, 1.170A-1. (Secs. 61, 80.219 Public recreation facilities. A non- §§1.162-15, 1.170A-1, 1.1245-1, 1.1250-1. 170; ’86 Code.) profit corporation organized to establish, main- (Secs. 162, 170, 1245, 1250; ’86 Code.) Rev. Rul. 77-436, 1977-2 C.B. 25. tain, and operate a public swimming pool, play- Rev. Rul. 76-151, 1976-1 C.B. 59. 80.234 Religious school. A religious school ground and other recreation facilities for which has a regular faculty, curriculum, and community residents is tax-exempt and contribu- 80.226 Realty; undivided present interest, enrollment of students in attendance at the place tions thereto are deductible as charitable contribu- The fair market value of an undivided two-fifths where its educational activities are conducted is an tions. §1.501(c)(3)-1. (Sec. 23(o), ’39 Code; Secs. present interest in real property, donated by the educational organization. Therefore, the addi- 170, 501, ’86 Code.) owner to a section 170(c) organization is deduct- tional ten percent deduction is applicable to con- Rev. Rul. 59–310, 1959-2 C.B. 146; Isabel ible as a charitable contribution. §1.170-1. (Sec. tributions made to it by individual donors. Peters, 21 T.C. 55, Acq., 1959-2 C.B. 6. 170, ’86 Code.) §1.170-2. (Sec. 170, ’86 Code.) Rev. Rul. 58-261, 1958-1 C.B. 143. Rev. Rul. 68–175, 1968–1 C.B. 83. 80.220 Publicly-supported organization. A section 501(c)(3) organization, under the facts 80.227 Realty; undivided present interest 80.235 Remainder interest in property; life presented, is a publicly-supported organization given state. A gift to a state of an undivided pres- estate retained. A remainder interest in farm referred to in section 170(b)(1)(A)(vi) of the ent interest in real property for use as a Governor’s property donated to the United States for use as a Code; contributions made to it are subject to the Mansion is a contribution for an exclusively pub- national park by a donor corporation which additional ten-percent charitable deduction and to lic purpose; the fair market value of the contrib- reserved to itself an estate for the life of a husband the five-year carryover provisions. §1.170–2. uted interest at the time of the gift is deductible as and wife or either of them as survivor, is deduct- (Sec. 170, ’86 Code.) a charitable contribution. (Sec. 170, ’86 Code.) ible as a charitable contribution in the year it is Rev. Rul. 68-355, 1968-2 C.B. 108. Rev. Rul. 57-511, 1957-2 C.B. 158. paid. §1.170-1. (Sec. 170, ’86 Code.) Rev. Rul. 73–297, 1973–2 C.B. 67. 80.221 Publicly-supported organization; 80.228 Recovery of donations; redonated to bequest held as endowment. For the purpose of 80.236 Rent-free use of property. Prior to the another charitable organization. Cash dona- amendment of section 170 of the Code by Pub.L. determining whether the “mechanical test” is tions to a charitable organization over a period of satisfied, an outright bequest which is received by 91–172, a charitable deduction would be allow- years that are repaid to a taxpayer and redonated able for rent-free use of property granted an an organization during one of the four taxable to another charitable organization in the same year years immediately preceding the current taxable exempt organization if it resulted in a legally are, to the extent a tax benefit was derived from enforceable conveyance of a present interest year and which is held as an endowment by such deductions claimed in prior years, includible in an organization rather than being disbursed for under local law. I.T. 3018 superseded. §1.170-1. gross income in the year of recovery under section (Sec. 170, ’86 Code.) current expenses, is includable in the computation 111. However, the repaid funds donated to the of support specified in section 1.170-2(5)(iii)(b) Rev. Rul. 70-477, 1970-2 C.B. 62. other organization are considered a charitable con- of the regulations. §1.170-2. (Sec. 170, ’86 Code.) tribution. §§1.61–1, 1.111–1, 1.170A-1. (Secs. 61, 80.237 Repayment of loans granted by Rev. Rul. 67-160, 1967-1 C.B. 65. 111, 170; ’86 Code.) exempt foundation. Amounts repaid by students Rev. Rul. 76-150, 1976-1 C.B. 38. on loans granted to them for the furtherance of 80.222 Publicly-supported organization; rul- their education by an exempt foundation are not ings. Organizations that have received ruling let- 80.229 Red Cross activities. A member of the deductible as charitable contributions. §1.170-1. ters holding them to be publicly supported under Board of Governors of the American Red Cross (Sec. 170, ’86 Code.) section 170(b)(1)(A)(vi) will be treated as such who traveled to Chicago to attend meetings and Rev. Rul. 71-269, 1971-1 C.B. 93. organizations for 90 days after publication of the stayed at a private club could deduct a portion of final regulations thereunder, even though the orga- the expenses at the club as charitable contribu- 80.238 Reserve officers’ association. Con- nizations do not qualify under such regulations, tributions to a reserve officers’ association are not tions. (Sec. 23(o), ’39 Code; Sec. 170, ’86 Code.) deductible as charitable contributions unless provided the facts on which the ruling is based Henry Cartan, 30 T.C. 308, Acq., 1958-2 C.B. have not been substantially changed and the ruling 4. membership is limited to war veterans, or the has not been expressly revoked. §§1.170-2, association is essentially a war veterans’ organiza- 301.7805-1. (Secs. 170, 7805; ’86 Code.) 80.230 Rehabilitation center. A contribution tion. §§39.23(o)-1, 39.23(q)–1. (Secs. 23(o), Rev. Rul. 71-298, 1971-2 C.B. 155. to a rehabilitation center to provide funds for a 23(q), ’39 Code; Sec. 170, ’86 Code.) building for use in the treatment of handicapped Rev. Rul. 55–156, 1955-1 C.B. 292. 80.223 Qualification of recipient; political individuals constitutes a contribution to a hospital. 80.239 Restoration of state-owned mansion. activities. Taxpayer claimed a charitable deduc- (Sec. 170, ’86 Code.) Payments made by a taxpayer to finance the resto- tion for contributions to a nonprofit corporation Rev. Rul. 55-268, 1955-1 C.B. 28. ration and maintenance of a state-owned historic organized by him for charitable purposes. Shortly mansion and its surrounding grounds in accor- after its organization exemption was denied under 80.231 Reimbursement to state for hospital dance with specifications set by the state, in section 101(6) of the ’39 Code due to a grant it care. Payments made to a state hospital for the exchange for a nonassignable right to reside on the made to another nonprofit corporation determined purpose of reimbursing the state for the hospital premises for a period of 15 years, are not deduct- by the Commissioner to be engaged in political care of a person do not constitute contributions or ible as charitable contributions unless the pay- activities. A refund of the grant was requested and gifts made to or for the use of a state for exclu- ments exceed the monetary value of all benefits received after which qualification was granted sively public purposes. Accordingly, such pay- received or expected to be received. The amount under section 101(6) for future years. Held, the ments are not deductible as charitable contribu- of any such excess would be deductible to the grant was made in good faith and the belief that the tions. (Sec. 170, ’86 Code.) extent provided bv section 170. §1.170A-1. (Sec. recipient was qualified under section 101(6); tax- Rev. Rul. 57-211, 1957-1 C.B. 97. 170, ’86 Code.) payer is entitled to the deduction claimed. (Sec. Rev. Rul. 76-185, 1976-1 C.B. 60. 23(o), ’39 Code; Sec. 170, ’86 Code.) 80.232 Religious order; members’ outside Murray Seasongood, 22 T.C. 671, Acq., 1954-2 eamings remitted to order. Amounts received by 80.240 Restricted easement in real property. C.B. 5. members of an exempt religious order, not acting A gratuitous conveyance to the U.S. of a restric- Charitable contributions tive easement in real property to enable the Fed- rate fund exclusively for religious, charitable, education of the public, with respect to the pur- eral Government to perserve the scenic view scientific, literary, or educational purposes, apart poses and the activities of the United Nations, is afforded certain public properties is a charitable from other funds, so that contributions to the fund not entitled to exemption under section 501(c)(3). contribution, and the grantor is entitled to a deduc- will be deductible. §§39.23(o)–1, 39.23(q)–1, However, contributions made to or for the use of tion for the fair market value of the easement; 39.101(6)-1. (Secs. 23(o), 23(o), 101, ’39 Code; the committee for exclusively public purposes are however, the basis of the property must be Secs. 170, 501, ’86 Code.) deductible. §§1.1701, 1.501(c)(3)-1. (Secs. 170, adjusted by eliminating that part of the total basis Rev. Rul. 54-243, 1954-1 C.B. 92. 501; ’86 Code.) which is properly allocable to the restrictive ease- Rev. Rul. 62–66, 1962–1 C.B. 83. ment granted. §1.170-1. (Sec. 170, ’86 Code.) 80.249 Service Corps of Retired Executives; Rev. Rul. 64-205, 1966-2 C.B. 62. out-of-pocket expenses. Unreimbursed out-of- 80.256 State Bar. Unrestricted contributions pocket transportation expenses and expenditures made to or for the use of an integrated State Bar 80.241 Road improvement project. The for meals and lodging while away from home, nec- that is not a political subdivision of a state and has amount paid to a county on a promissory note essarily incurred by a volunteer member of the private as well as public purposes are not deduct- conditioned on, and payable upon, the county Service Corps of Retired Executives (SCORE) ible under section 170. Rev. Rul. 59–152 revoked. hard-surfacing the roads in the vicinity of the tax- while rendering gratuitous services as a business Amplified by Rev. Rul. 78-129. §§1.1701, payer’s property is not deductible as a charitable consultant directly to small businessmen in fur- 301.7805-1. (Secs. 170, 2055, 2522, 7805; ’86 contribution; however, the amount paid is a capital therance of the purpose of the Small Business Code.) expenditure. §§1.170A-1, 1.263(a)–1. (Secs. 170, Administration to provide management assistance Rev. Rul. 77–232, 1977-2 C.B. 71. 263; ’86 Code.) to small firms, are deductible as charitable con- Rev. Rul. 76-257, 1976-2 C.B. 52. tributions. §1.170–1. (Sec. 170, ’86 Code.) 80.257 State Bar. The satisfaction on or after Rev. Rul. 67-362, 1967-2 C.B. 117. July 5, 1977 of a legally enforceable obligation 80.242 Sales promotion. Amounts paid by the resulting from a pledge made prior to that date to sole stockholder of a corporation to a charity in the 80.250 Services for charitable organization; an integrated State Bar may qualify as a deductible redemption of tags attached to products sold by the travel expenses. A per diem travel expense allow- charitable contribution. Rev. Rul. 77–232 ampli- corporation are nondeductible charitable contribu- ance received by an individual performing gratu- fied. §§1.170-1, 301.7805-1. (Secs. 170, 2053, tions. (Sec. 170, ’86 Code.) itous services for a charitable organization is 2055, 2522, 7805; ’86 Code.) Rev. Rul. 55–514, 1955-2 C.B. 55. includable in gross income to the extent it exceeds Rev. Rul. 78-129, 1978-1 C.B. 67. actual travel expenses; expenditures in excess of 80.258 State international steeplechase race; 80.243 Salvation Army. The Salvation Army is the allowance received are deductible as charita- a church or convention of churches and contribu- ble contributions. §§1.61-1, 1.170-2. (Secs. 61, sponsorship advances. Sponsorship payments to tions to it will be deductible by the donor. 170; ’86 Code.) the Department of Parks, Recreation, and Tourism §1.170-2. (Sec. 170, ’86 Code.) Rev. Rul. 67–30, 1967–1 C.B. 9. of a State used to pay deficits incurred in running Rev. Rul. 59-129, 1959-1 C.B. 58. a State sponsored steeplechase race to promote 80.251 Services for exempt organization; tourism are deductible as a charitable contribution 80.244 Section 306 stock; appreciated in traveling expenses. A taxpayer who gives his ser- to the extent actually used for that purpose. value. An example illustrates that the amount vices gratuitously to an association, contributions §1.170-1. (Sec. 170, ’86 Code.) allowable as a deduction for a charitable contribu- to which are deductible under section 23(o) of Rev. Rul. 72–194, 1972-1 C.B. 94. tion of section 306 stock, made after 1969, is the the ’39 Code, and who incurs unreimbursed travel- 80.259 State pension plan; third party dona- fair market value of the stock reduced by the ing expenses, including the cost of meals and lodg- tions. Contributions made by third parties to pen- amount of gain that would not have been long- ing, while away from home in connection with the sion funds established under a state law for the term capital gain if the stock had been sold at its affairs of the association and at its direction, may benefit of municipal employees, municipal fair market value at the time of the contribution. deduct such amounts as a charitable contribution. policemen, or municipal firemen are deductible §§1.170A-4, 1.306-1. (Secs. 170, 306; ’86 Code.) §§39.23(a)-1, 39.23(o)-1. (Secs. 23(a), 23(o), ’39 by the donors. (Sec. 170, ’86 Code.) Rev. Rul. 76-396, 1976–2 C.B. 55. Code; Secs. 162, 170, ’86 Code.) Rev. Rul. 58-154, 1958-1 C.B. 125. Rev. Rul. 55-4, 1955-1 C.B. 291. 80.245 Section 306 stock; contributed to 80.260 State Presidential inaugural parade exempt organization. Where a shareholder, hold- 80.252 Services for exempt organization; fund. Contributions to a fund established by a ing common stock of a corporation, received a traveling expenses. Traveling expenses incurred State to defray the expense of providing State units stock dividend payable in newly issued preferred in connection with the performance of official in a Presidential inauguration parade are deduct- stock, and, in turn, transferred the preferred stock duties by an uncompensated officer and member ible by the contributors. (Sec. 170, ’86 Code.) to a tax-exempt charitable foundation, such a of an organization exempt from tax under section Rev. Rul. 58–265, 1958-1 C.B. 127. transfer or subsequent sale of the stock by the 501(c)(4) are not deductible as charitable con- foundation involved no realization of income to tributions. Modified to provide that such expenses 80.261 State sales and use tax refund given the shareholder within the meaning of section incurred by an uncompensated officer and mem- State. State sales and use taxes previously 306(a). The contribution of the preferred stock to ber of an organization, which is of the type con- deducted, which has been determined to be erro- the foundation is deductible as a charitable con- templated by section 170(c)(3), are deductible as neously collected and subject to refund but which tribution. §1.3061. (Secs. 170, 306; ’86 Code.) charitable contributions and a war veterans’ orga- the taxpayer chooses to treat as a gift to the State, Rev. Rul. 57-328, 1957-2 C.B. 229. nization, exempt under section 501(c)(4), may be are includible in gross income in the year all events of the type contemplated by section 170(c)(3). occured that fixed his right to a refund; however, 80.246 Section 306 stock; contributed to §39.23(o)-1. (Sec. 23(o), ’39 Code; Sec. 170, ’86 a charitable deduction is allowable for the taxable exempt organization. A corporation issued sec- Code.) year during which the State is affirmatively noti- tion 306 stock to its controlling shareholder in a Rev. Rul. 55–151, 1955–1 C.B. 28; Rev. Rul. fied of the gift; where no such action has been reorganization to accomplish a valid business 57-327, 1957-2 C.B. 155. taken and the statute of limitations within which to objective, although an issue of long term bonds file a claim for refund with the State has expired, would have accomplished the same objective. The 80.253 Social welfare organization; represen- no deduction is allowable. Distinguished by Rev. shareholder has not shown that none of the princi- tation on tax matters. A nonprofit organization Rul. 73–385. §§1.61–1, 1.170–1, 1.451–1. (Secs. pal purposes of the stock issue was the avoidance formed to promote the common good and welfare 61, 170, 451; ’86 Code.) of federal income tax. The shareholder’s charita- of the general public by representing the interests Rev. Rul. 70-419, 1970-2 C.B. 5. ble contribution of the stock will be reduced under of the public at legislative and administrative hear- section 170(e)(1)(A). §§1.170A-4, 1.306–2. ings on tax matters qualifies for exemption as a 80.262 Statue given through foreign country (Secs. 170, 306; ’86 Code.) social welfare organization. Contributions to the to U.S. city. The cost to the taxpayer of creating a Rev. Rul. 80-33, 1980-l C.B. 69. organization are not deductible. §§1.170-1, statue which he donated to a foreign government 1.501(c)(4)-1. (Secs. 170, 501; ’86 Code.) that formally presented it to a city in the U.S. is not 80.247 Securities; right to require cash dis- Rev. Rul. 71-530, 1971-2 C.B. 237. deductible by the taxpayer as a contribution or gift tribution retained. A grantor may claim a con- to the city receiving the statue. (Sec. 170, ’86 tribution, subject to the additional ten percent 80.254 Stadium for school district. Contribu- Code.) imitation, for securities transferred to a section tions to an exempt organization organized to build Rev. Rul. 58-405, 1958-2 C.B. 98. 170(b)(1)(A) organization, even though he may a stadium and lease it to a school district are later require the organization to distribute cash deductible. (Sec. 170, ’86 Code.) 80.263 Stock; reacquired from charitable equivalent to their fair market value to a similar Rev. Rul. 57-493, 1957-2 C.B. 314. donee. Where a donor transfers stock, without organization. §1.170-2. (Sec. 170, ’86 Code.) consideration, to a charitable organization under a Rev. Rul. 69–276, 1969–1 C.B. 64. 80.255 State activity; promotion of the “gentlemen’s agreement” which allows him to United Nations. A committee created by execu- reacquire the stock one month later at its then fair 80.248 Separate charitable fund. Exempt tive order of the governor of a state as an official market value, the amount of cash paid to the donee organizations, other than those exempt under sec- agency to commemorate “United Nations Day” in reacquiring the stock, and not the fair market tion 101(6) of the ’39 Code, may establish a sepa- and to conduct a continuing program for the value of the stock when transferred, is deductible Charitable contributions as a charitable contribution. The basis of the stock purposes of the minimum tax. §§1.642(c)-3, 80.278 Trust; deduction. A trust does not qual- in the hands of the donor remains the same as it 1.1202-1. (Secs. 57, 642, 1202; ’86 Code.) ify as a charitable remainder trust and no deduc- was before he transferred the stock. §§1.170–1, Rev. Rul. 74-317, 1974-2 C.B. 13. tion is allowable under sections 170 and 2522 if it 1.1012-1. (Secs. 170, 1012; ’86 Code.) is possible that federal estate and state death taxes Rev. Rul. 67–178, 1967–1 C.B. 64. 80.272 Trust; capital gains. The deduction of may be payable from the trust assets. However, a 50 percent capital gains deduction allowed under trust will qualify as a charitable remainder trust 80.264 Stock; voting; donor retaining right to section 1202 is not a tax preference item for deter- and a deduction is allowable under sections 170 vote. A contribution of voting stock to a charitable mining tax liability under section 56 for a trust that and 2522 if a secondary life beneficiary furnishes organization with the donor retaining the right to pays its capital gains to a charitable organization. the funds for the payment of any death taxes for vote that stock constitutes a contribution of a par- §§1.642(c)-1, 1.1202-1. (Secs. 57, 642, 1202; ’86 which the trust may be liable. Rev. Rul. 72–395 tial interest for which a charitable contribution Code.) modified. §§1.170A-1, 1.664–3, 301.7805–1. deduction is not allowable. §1.170A-7. (Sec. 170, Rev. Rul. 73-43, 1973-1 C.B. 37. (Secs. 170, 664, 2036, 2522, 7805; ’86 Code.) ’86 Code.) Rev. Rul. 82-128, 1982–2 C.B. 71. Rev. Rul 81-282, 1981-2 C.B. 78. 80.273 Trust; capital gains; charitable and noncharitable bequests. A trust that is terminat- 80.279 Trust; income set aside for charitable 80.265 Sustainer’s gift; admission to retire- ing and sells certain assets at a gain to meet the purposes. A trust which provides for the reversion ment home. A sustainer’s gift that is requested by requirements of its governing instrument that it of principal on termination to the creator does not a retirement home based on the type of accom- pay a bequest of a specified dollar amount from its qualify for exemption; however, where the net modations desired and paid by the taxpayer before corpus in a single payment to a noncharitable trust, income of the trust is required, under the terms of acceptance for residency is not deductible as a the remainder of its corpus being payable to a char- the governing trust instrument, to be used exclu- charitable contribution. §1.170-1. (Sec. 170, ’86 itable organization, is entitled to deduct under sec- sively for religious, charitable or educational pur- Code.) tion 642(c)(1) the lesser of the amount of the chari- poses, the organization is allowed deductions by Rev. Rul. 72–506, 1972-2 C.B. 106. table distribution or the capital gain realized, section 642(c) (subject to the limitations of that subject to the requirements of section 642(c)(4). section) of an amount equal to its entire net 80.266 Tax benefit rule; trust corpus The amount paid to the noncharitable trust is not income. §§1.501(c)(3)–1, 1.642(c)–1. (Secs. 501, returned to grantor. The William F. Perry deci- deductible by the terminating trust under section 642; ’86 Code.) sion holding that the return to the grantor of the 661, nor includible in the noncharitable trust’s Rev. Rul. 66-259, 1966-2 C.B. 214. corpus of a charitable trust constitutes a nontax- gross income. §§1.642(c)-1, 1.661(a)-1, able return of capital even though the grantor had 1.662(a)-1, 1.663(a)-1. (Secs. 642, 661, 662, 663; 80.280 Trust; income to discharge charitable realized full tax benefits from charitable deduc- ’86 Code.) pledge of grantor. The grantor will not be treated tions allowed for transfers to the trust in prior tax as the owner of a trust, under section 677, where Rev. Rul. 78-24, 1978-1 C.B. 196. trust income is applied to discharge a charitable years, will not be followed. (Sec. 61, ’86 Code.) Rev. Rul. 59-141, 1959-1 C.B. 17. pledge made by the grantor, if he would have been 80.274 Trust; charitable deduction; grantor entitled to a deduction under section 170 if he had 80.267 Theater ticket donated to sponsoring trust. An irrevocable trust whose governing personally satisfied the pledge. The grantor will organization for resale. The holder of a season instrument provides for distribution of all ordinary not be entitled to any charitable deduction on to organizations described in ticket to a theatrical series who donates, for resale incomeby the close of the year followingsection account of payments of trust income; however, 170(c) the by the sponsoring charitable organization, a ticket of receipt, addition of capital gains to corpus,year and such payments will be deductible by the trust. to an individual theater performance for which a termination of the trust and distribution of corpus §§1.170-1, 1.677(a)-1. (Secs. 170, 677; ’86 single admission charge equals or exceeds the Code.) average cost per performance of a season ticket is to the grantor no sooner than ten years and one Rev. Rul. 64-240, 1964–2 C.B. 172. after its creation entitled to a charitable contribution deduction of month section 642(c)(1)is allowed a deduction 80.281 Trust; political subdivision of foreign for amounts of gross an amount equal to his pro rata cost of the individ- under paid to the charitable organizations, income government. A trust whose governing instrument ual performance ticket. Rev. Rul. 67–246 distin- except to the extent the trust has unrelated busi- requires it to pay its income annually to a political guished. §1.170A-1. (Sec. 170, ’86 Code.) ness income. §§1.642(c)–1, 1.671–1, 1.677(a)–1. subdivision of a foreign government, with the Rev. Rul. 74-348, 1974-2 C.B. 80. (Secs. 642, 671, 677; ’86 Code.) principal to revert to the grantor at the end of Rev. Rul. 79–223, 1979-2 C.B. 254. twelve years, and suggests, but does not require, 80.268 Township authority; sewer and water that the income be used for educational purposes system. The Township of Falls Authority, may not deduct such unrestricted income pay- engaged in constructing, maintaining, and operat- 80.275 Trust; charitable deduction; no pay- ments to the political subdivision of the foreign ing a sewer and water system for the benefit of the ment. A nonexempt charitable trust, whose agree- government as charitable contributions under sec- residents of such township, is a political subdivi- ment required that income be used for charitable tion 642(c). §1.642(c)–1. (Sec. 642, ’86 Code.) sion of Pennsylvania, and contributions made to it purposes, but was unable to pay out any income Rev. Rul. 78-436, 1978–2 C.B. 187. are deductible as made to or for the use of a politi- for charitable purposes that year due to obligations cal subdivision of a state. §1.170-1. (Sec. 170, ’86 in connection with a prior year’s transaction, prop- 80.282 Trust; reversionary; income for hene- Code.) erly deducted an amount equal to its net income as tit of grantor. The grantor of a trust created for Rev. Rul. 58-473, 1958–2 C.B. 100. a charitable contribution. (Sec. 162(a), ’39 Code; both private and charitable purposes has a rever- Sec. 642, ’86 Code.) sionary interest under section 170 when there is a 80.269 Transfer to nonexempt fund. A con- Leon A. Beeghly Fund, 35 T.C. 490, Nonacq., possibility that income or corpus in excess of five tribution to an exempt organization, earmarked for 1962-1 C.B. 4. percent may be used for the benefit of the grantor a particular purpose and subsequently transferred in supporting his minor child, even though the at the request of the donor to a nonexempt fund, 80.276 Trust; charitable gifts per settlement grantor does not have a reversionary interest constitutes taxable income to the donor for the agreement. Payments to charity, made by the within the meaning of section 673. Therefore, no year of transfer, to the extent of the amount pre- executor of an estate out of estate income, attribut- deduction is allowable to the grantor for charitable viously taken as a deduction. §§39.23(o)–1, able to that part of the estate transferred to charity, charges placed upon the trust, and income from the 39.23(q)–1. (Secs. 23(o), 23(q), ’39 Code; Sec. under the terms of a settlement agreement result- trust is not taxable to the grantor except to the 170, ’86 Code.) ing from the contest of a will, are deductible by the extent actually used for the support and mainte- Rev. Rul. 54-566, 1954-2 C.B. 96. estate as gifts of income to charity. Rev. Rul. nance of the minor child. §§1.170-2, 1.673(a)–1, 55-122 revoked. §1.642(c)-1. (Sec. 642, ’86 1.677(b)-1. (Secs. 170, 673, 677; ’86 Code.) 80.270 Transfer to trust. Where a taxpayer Code.) Rev. Rul. 61-223, 1961-2 C.B. 125. irrevocably transfers property to a trust to be held Rev. Rul. 59-15, 1959-1 C.B. 164. for a period of 10 years and 10 days for the benefit 80.283 Trust; reversionary; interest donated. of a charitable foundation meeting the require- 80.277 Trust; created for construction of Taxpayers who established similar income trusts ments of section 23(o)(2) of ’39 the Code, the tax- building. Taxpayers made contributions to a trust in 1960 and 1971 for the benefit of relatives and a payer is entitled to a deduction of the present value whose only activity was the receiving and holding long-time employee of the family owned corpora- of the property interest which she contributed to of funds to be used for the construction of a build- tion whose stock formed the trust corpus, main- the trust. §29.23(o)–1. (Sec. 23(o), ’39 Code; Sec. ing to house domestic fraternal societies operating tained their financial security and protected 170, ’86 Code.) under the lodge system and to be used exclusively against a take-over by dissidents through a rever- Rev. Rul. 194, 1953–2 C.B. 128. for religious, charitable, scientific, literary and sionary interest and restrictive language in the educational purposes. After the building was com- trust instrument, and donated their reversionary 80.271 Trust; capital gains. The capital gain pleted the trust was recognized as a tax-exempt interest to a charitable organization after a 1975 deduction allowed to a trust with respect to its net charitable organization. Held, taxpayers’ con- merger of the family corporation into a widely long-term capital gain permanently set aside for tributions were deductible as charitable contribu- traded, publicly owned corporation are not pre- the use of a charitable organization in accordance tions. (Sec. 23(o), ’39 Code; Sec. 170, ’86 Code.) vented by the provisions of section l70(f)(3)(A), with section 642(c) is not a tax perferenceitem for Fred Draper, 32 T.C. 545, Acq., 1960-2 C.B. 4. added by the Tax Reform Act of 1969, from claim- Charitable contributions ing the donation as a charitable deduction. 80.290 Trust remainder; collection of rare be redesignated from an organization qualifying §1.170A-1. (Sec. 170, ’86 Code.) coins. The transfer of a coin collection to a trust for the 50 percent limitation to an organization Rev. Rul. 76-523, 1976-2 C.B. 54. with a retained life interest in exhibition fees and subject to the 20 percent limitation. §§1.170A-6, remainder to charities is a transfer of a future inter- 1.664-2, 1.664-3. (Secs. 170, 664; ’86 Code.) 80.284 Trust; reversionary; interest released est in tangible personal property for which a con- Rev. Rul. 79-368, 1979-2 C.B. 109. by grantor. The release by a grantor of a portion tribution deduction is not allowable in the year of of his reversionary interest in a trust in favor of a transfer. §1.170–1. (Sec. 170, ’86 Code.) 80.297 Trust remainder; pooled income fund. qualified charitable organization gives rise to a Rev. Rul. 69-63, 1969-1 C.B. 63. An otherwise qualifying fund whose governing deduction for a charitable contribution measured instrument permits the duration of a beneficiary’s by the value of such portion of the reversionary 80.291 Trust remainder; conditional gift. income interest to be measured by the life of interest at the time of its release. §1.170-1. (Sec. Elderly taxpayers created a trust naming them- another does not qualify as a pooled income fund 170, ’86 Code.) selves trustees and life income beneficiaries with under section 642(c)(5), and the value of a remain- Rev. Rul. 67-363, 1967-2 C.B. 118. remainder to their designated charities. The trust der interest in property transferred to the fund is instrument provided for the return of their con- not deductible under section 170, 2055, 2106, or tribution if a charitable deduction were disal- 2522, even though the instrument of transfer bases 80.285 Trust; reversionary; transfer of lowed. Held, neither the trust proviso nor the tax- the duration of the designated beneficiary’s divested stock. The transfer of certain stock to a payer’s broad management powers prevented the income interest on the beneficiary’s life. The reversionary trust, part of the income from which charitable deduction. The contribution could not fund’s governing instrument may be amended to is “divested stock” within the meaning of section be recaptured if the instant litigation were success- qualify prospectively if the fund has not accepted 1111(e), where such divested stock is payable irre- ful and, under the circumstances, it was highly property under a defective instrument of transfer. vocably for a period of over two years to certain improbable that the charities would not receive the §§1.170A-6, 1.642(c)-5. (Secs. 170, 642, 2055, designated charities is not, under the circum- remainder interest. (Sec. 170, ’86 Code.) 2106, 2522; ’86 Code.) stances, taxable to the taxpayer-grantor; however, William D. O’Brien, 46 T.C. 583, Acq., 1968-1 Rev. Rul. 79-61, 1979–1 C.B. 220. because of his reversionary interest in the divested C.B. 2. stock he is not allowed a charitable deduction. 80.298 Trust remainder; power of appoint- §§1.170-2, 1.673(b)-1. (Secs. 170, 673; ’86 80.292 Trust remainder; conditional gift. ment retained. Retention of power to appoint spe- Code.) Where a trust agreement makes a present gift to cific beneficiaries of a charitable remainder inter- Rev. Rul. 67-42, 1967-1 C.B. 164. charity of a future interest in property and contains est, including organizations other than those a provision calling for the revocation of any of the described in section 170(b)(1)(A), does not defeat 80.286 Trust income; trust not terminated. broad discretionary powers given to the trustees if, the charitable contribution deduction, subject to Although the trustees have the power to terminate by reason thereof, Federal tax liability is incurred, the 20 percent limitation of section 170(b)(1)(B). the trust at any time and pay over the entire corpus such provision is a condition subsequent which is §1.170-1. (Sec. 170, ’86 Code.) or income to certain charities, a donation to a char- contrary to public policy and therefore void. Rev. Rul. 68–417, 1968–2 C.B. 103. ity made out of income prior to a decision to termi- Accordingly no deduction will be allowed for the nate the trust is not deductible by the trust estate. present worth of the charitable remainder interest. 80.299 Trust remainder; power of appoint- §39.162-1. (Sec. 162, ’39 Code; Sec. 641, ’86 Distinguished by Rev. Ruls. 75-440 and 76-199. ment retained. Taxpayer created irrevocable Code.) §1.170-2. (Secs. 170, 2522; ’86 Code.) trusts with named individuals as life income bene- Rev. Rul. 55-92, 1955-1 C.B. 390. Rev. Rul. 65-144, 1965-1 C.B. 442. ficiaries and the remainders to such charities as appointed in her will. Her power of appointment 80.293 Trust remainder; conditional gift. The was limited to charities meeting the limitations of 80.287 Trust remainder. When a taxpayer section 170(b)(1)(A). Held, the present value of creates a trust, naming a designated beneficiary as contingent provision in a trust instrument, provid- ing that all the trust assets revert to the grantors in the remainder interests are deductible gifts to, not the life tenant with the remainder interest to a char- merely for the use of, such charities. (Sec. 170, ’86 itable organization, amounts contributed to the the event the Service disallows a charitable deduc- tion for the value of the remainder interest, pre- Code.) trust are not considered to be made to the charity. Alice Tully, 48 T.C. 235, Acq., 1970–2 C.B. xxi. The present value of the remainder interest consti- cludes the trust from meeting the definition of a tutes an amount contributed for the use of the char- charitable remainder annuity trust and the value of 80.300 Trust remainder; sample forms; uni- ity and is deductible in the taxable year the prop- the remainder interest contributed to the trust is trust. This revenue procedure makes available a erty is transferred to the trust. §39.23(o)–1. (Sec. not deductible as a charitable contribution. Rev. sample form of declaration of trust that meets the 23(o), ’39 Code; Sec. 170, ’86 Code.) Rul. 60-276 distinguished. §§1.170A-1, 1.664-1. requirements for an inter vivos charitable remain- Rev. Rul. 57-562, 1957-2 C.B. 159. (Secs. 170, 664; ’86 Code.) der unitrust providing for unitrust payments for Rev. Rul. 76-309, 1976-2 C.B. 196. one life, as described in section 664(d)(2) of the 80.288 Trust remainder; capital gain dis- Code. §§1.170A-6, 1.664-3. (Sec. 601.201, 80.294 Trust remainder; “divested stock.” S.P.R.; Secs. 170, 664, 2522, ’86 code.) tributions from mutual funds. Where local law Tax consequences of a trust arrangement where an authorizes a trustee to invest corpus in the stock of Rev. Proc. 89-20, 1989-1 C.B. 841. individual taxpayer transfers in trust, prior to a regulated investment companies and to pay out divestiture distribution, stock in a company which capital gains distributions received therefrom as 80.301 Trust remainder; undivided interest. is subject to an “antitrust order” within the mean- The present value of an undivided portion of a tax- income under the general provisions of the gov- ing of section 1111(d) and the divested stock is erning instrument, a charitable deduction is not payer’s entire remainder interest in property of a paid over by the trustee to become the corpus of a trust that is contributed to a charitable organiza- allowable with respect to a charitable remainder second trust, created under the same instrument, interest as the charitable interest is not severable tion is deductible in the manner and to the extent income of which is payable to the grantor and oth- provided in section 170. §1.170-1. (Sec. 170, ’86 from the noncharitable interest. This ruling will ers with remainder to charitable organizations. not be applied with respect to transfers completed Code.) §§1.170-2, 1.677(a)-1. (Secs. 170, 677; ’86 Rev. Rul. 72-419, 1972-2 C.B. 104. prior to May 1, 1967, or, under certain circum- Code.) stances, to transfers made under instruments Rev. Rul. 68-440, 1968-2 C.B. 289. 80.302 Trust remainder; unitrust. The remote executed prior to that date. Rev. Rul. 60-385 sup- possibility that a foundation, an organization qual- plemented. §§1.170-1, 301.7805-1. (Secs. 170, 80.295 Trust remainder; gain realized on ifying under section 170(c) and the trustee-chari- 7805; ’86 Code.) principal. Gain realized from the sale or exchange table remainderman under a charitable remainder Rev. Rul. 67-33, 1967-1 C.B. 62. of trust assets which under state law become a part unitrust, would not qualify under section 170(c) of trust principal and which will, upon termination upon termination of the trust will not preclude a 80.289 Trust remainder; capital gain divi- of the trust, go to an organization described in sec- charitable contribution deduction of the value of dends as corpus. Where an irrevocable trust pro- tion 170(c) may be regarded as permanently set the remainder interest where the trust instrument vides that capital gain dividends received from aside for a charitable purpose where it can be reli- provided in such event that distribution be made to stock in regulated investment companies shall be ably predicted, after considering all the facts, that other qualifying charities selected by the trustees. treated as corpus and held for the charitable the principal of the trust will not be invaded for the §§1.170A-6, 1.664-1. (Secs. 170, 664, 2055, remainderman rather than distributed to the non- benefit of the income beneficiary. §1.642(c)-1. 2106, 2522; ’86 Code.) charitable life tenant, such dividends are deduct- (Sec. 642, ’86 Code.) Rev. Rul. 76–307, 1976–2 C.B. 56. ible and may be valued by the use of the appropri- Rev. Rul. 66-367, 1966-2 C.B. 241. ate actuarial remainder table. However, where 80.303 United charities plan. An employee of such capital gain dividends are treated as income 80.296 Trust remainder; percentage limita- a corporation having a so-called united charities and paid to the life tenant, no deduction for chari- tion of deduction. The allowable charitable plan may attach to his return a statement furnished table contributions is allowable. Rev. Rul. 55–620 deduction for property transferred to a valid chari- by the administrators of the plan showing the total revoked. Supplemented by Rev. Rul. 67–33. table remainder trust is subject to the 20 percent amount of his contributions and the percentage of §1.170-1. (Sec. 170, ’86 Code.) contributions limitation when the organization such total amount which was distributed to each Rev. Rul. 60-385, 1960-2 C.B. 77. designated to receive the remainder interest may designated charitable organization and then on his Charitable contributions return the name of the plan and the total amount deductible personal expenses. However, this does 77–280, 79-142, and 80-45 modified. §1.170A-1. contributed during the year. §39.23(o)-1. (Sec. not preclude the deduction of unreimbursed (Sec. 170, ’86 Code.) 23(o), ’39 Code; Sec. 170, ’86 Code.) expenses which are directly connected with the Rev. Rul. 84-61, 1984–1 C.B. 39; John D. Rev. Rul. 54-549, 1954-2 C.B. 94. rendition of gratuitous services performed for the Rockefeller, 3rd, 76 T.C. 178, Nonacq. withdrawn church during the meeting. §§1.170-2, 1.262–1. and Acq. substituted, 1984–1 C.B. 1. 80.304 Universities; alumni associations. (Secs. 170, 262; ’86 Code.) Social and recreational activities carried on by an Rev. Rul. 61-46, 1961-1 C.B. 51. 80.319 Unreimbursed expenses; Red Cross alumni association of a university, which are and church workers. A charitable deduction is merely incidental to its basic purpose and objec- 80.312 Unreimbursed expenses; church dea- allowable for unreimbursed out-of-pocket tive of advancing the interests of the university, docon candidate. A taxpayer’s unreimbursed out- expenses incurred for transportation to and from a not of themselves preclude such organization from of-pocket expenses for vestments, books, and local hospital or church for the purpose of render- tax exemption as a charitable and educational transportation while participating, either as a dea- ing volunteer services to the American Red Cross association. Contributions, exclusive of member- con candidate or as an ordained deacon, in a per- and to the church and for the cost and maintenance ship dues, to such association are deductible, manent diaconate program established by the tax- of uniforms which are required to be worn, if such G.C.M. 22116 revoked. §§1.170-1, payer’s church are deductible as charitable uniforms are without general utility. However, the 1.501(c)(3)-1. (Secs. 170, 501; ’86 Code.) contributions. §1.170A-1. (Sec. 170, ’86 Code.) cost of meals, unless necessarily incurred while Rev. Rul. 60-143, 1960-1 C.B. 192. Rev. Rul. 76-89, 1976-1 C.B. 58. away from home overnight in the course of render- ing the volunteer services, is a nondeductible per- 80.305 Universities; endowment associa- 80.313 Unreimbursed expenses; church sonal expense. (Secs. 162, 170, 262; ’86 Code.) tions. Contributions to a university endowment evangelistic services. A taxpayer incurred out-of- Rev. Rul. 56-508, 1956-2 C.B. 126. association which acted as trustee of gifts made to pocket expenses in spreading the religious beliefs a university were not entitled to the maximum of his church through evangelistic work which the 80.320 Unreimbursed expenses; “study mis- charitable contribution deduction. Rev. Rul. local church approved, encouraged, and aided, but sion” abroad. Unreimbursed expenses incurred 60-111 distinguished. §1.170-2. (Sec. 170, ’86 did not order, control, supervise, or pay for. Held, by a taxpayer participating in a “study mission” Code.) taxpayer’s expenses were deductible contribu- to Europe and Asia, authorized by a charitable Rev. Rul. 60-110, 1960-1 C.B. 121. tions “to or for the use of” the church. (Sec. 170, organization exempt from taxation under section ’86 Code.) 501(c)(3), are not deductible as charitable con- 80.306 Universities; fraternity houses. Con- Travis Smith, 60 T.C. 988, Acq., 1974-2 C.B. 4. tributions Rev. Rul. 58–240 clarified. §1.170-2. tributions made to a college for the purpose of (Sec. 170, ’86 Code.) acquiring or constructing a housing facility for use 80.314 Unreimbursed expenses; city council Rev. Rul. 71-135, 1971-1 C.B. 94. by a designated fraternity, under certain terms and member staff expenses paid from personal 80.321 Unreimbursed expenses; VITA volun- conditions, constitute allowable charitable deduc- funds. A member of a city council may deduct teers. Unreimbursed expenses for transportation, tions. §1.170-1. (Sec. 170, ’86 Code.) expenditures for salaries, office rent, and office paper and pencils, newspaper advertising, and Rev. Rul. 60-367, 1960-2 C.B. 73. supplies under section 162 provided the member similar items incurred by volunteers in connection itemizes deductions; however, the expenditures with their participation in the Volunteer Income 80.307 Unlimited; interpretation of “income are not deductible as charitable contributions Tax Assistance (VITA) program are deductible tax paid”. The income tax referred to in section under section 170, and the limitations of section under Section 170. §1.170A-1. (Sec. 170, ’86 170(b)(1)(C), relating to the unlimited deduction 162(b) do not apply. Rev. Rul. 59–160 revoked for charitable contributions, contemplates only and Rev. Ruls. 73–464 and 73–113 amplified. Code.) Rul. 80-45, 1980-1 C.B. 54. Rev. Federal income tax. §39.120–1. (Sec. 120, ’39 §§1.162-1, 1.170A-1. (Secs. 162, 170; ’86 Code.) Code; Sec. 170, ’86 Code.) ReV. Rul. 84-110, 1984-2 C.B. 35. 80.322 Valuation; auction sale. Taxpayers Rev. Rul. 55–308, 1955–1 C.B. 30. donated high quality household furnishings and 80.315 Unreimbursed expenses; Civil furs to a charity that sold the items shortly there 80.308 Unlimited deduction; qualification. In Defense volunteers. Actual unreimbursed after at unrestricted auctions for prices below their a taxable year for which the taxpayer seeks to qual- expenses incurred by civil defense volunteers in professionally appraised value.Held, the amounts ify for the unlimited charitable contribution the performance of their volunteer duties, such as received at auction were not conclusive of fair deduction, the full amount of the taxpayer’s chari- traveling expenses to watch atomic bomb tests, the market value for purposes of determining the table contributions must be taken into account in expenses of attending state meetings of civil allowable deduction; evidence of items’ condition computing his income tax liability. If this results defense volunteers, or other expenses directly and character, intrinsic and appraised value, and in nonqualification, the year may nevertheless connected with and solely attributable to the rendi- original and replacement cost indicated that qualify as a preceding year where the unlimited tion of such volunteer services, are deductible as higher prices could have been obtained under deduction is sought in a subsequent year. charitable contributions. (Sec. 170, ’86 Code.) other circumstances. (Sec. 170, ’86 Code.) §1.170-2. (Sec. 170, ’86 Code.) Rev. Rul. 56-509, 1956-2 C.B. 129. Daniel S. McGuire, 44 T.C. 801, Acq. in Result, Rev. Rul. 67-460, 1967–2 C.B. 123. 1966-1 C.B. 2. 80.316 Unreimbursed expenses; National 80.309 Unlimited overpayment credited Conference on Law and Poverty convention. 80.323 Valuation; fair market value; donated against estimated tax. An overpayment of tax Out-of-pocket expenses incurred for transporta- property. The fair market value of agricultural or which is claimed and allowed as a credit against tion, meals and lodging while away from home by manufactured products or property held for sale in the estimated tax for the succeeding year consti- persons officially invited and who attended the the ordinary course of business contributed to a tutes income tax paid in the succeeding year, for National Conference on Law and Poverty are charitable organization is not includable in the the purpose of applying the unlimited charitable deductible as charitable contributions. §1.170-2. donor’s gross income and is allowable as a charita- contributions deduction, to the extent that esti- (Sec. 170, ’86 Code.) ble contribution as of the date of the gift and for mated tax payments during the succeeding year do Rev. Rul. 65-285, 1965-2 C.B. 56. this purpose, the fair market value will be the not exceed the tax liability. §39.120–1. (Sec. 120, replacement cost in the donor’s most favorable ’39 Code; Sec. 170, ’86 Code.) 80.317 Unreimbursed expenses; organiza- market. However, to avoid a double deduction, the Rev. Rul. 55-255, 1955-1 C.B. 374. tion’s program for unmarried pregnant opening inventory for the year of the gift must be women. A charitable deduction is allowable for reduced to reflect the removal of the donated prop- 80.310 Unreimbursed expenses; church con- unreimbursed out-of-pocket expenses incumed by erty, and no deduction will be allowed in the year vention. Unreimbursed expenses incurred by a lay taxpayers participating in a program conducted by of contribution for cost of producing the donated member of a church who is appointed as delegate a charitable organization to assist unmarried preg- property. Considered modified to remove the to a church convention, or unreimbursed expenses nant women by taking an unmarried pregnant replacement cost concept of the fair market value incurred by a delegate to an American Legion woman into their home for a two-month period of property contributed to a charitable organiza- Convention, and expenses directly connected with and providing her with food and clothing and a tion. I.T. 3910 revoked. §§39.22(a)-5, 39.22(a)–7, and solely attributable to the rendition of services small weekly allowance. §1.170-2. (Sec. 170, ’86 39.23(a)–1, 39.23(o)–1, 39.23(a)-1, 1.170-1. by them to the church or to the Legion are deduct- Code.) (Secs. 22(a), 23(a), 23(o), 23(q), ’39 Code; Secs. ible as charitable contributions. I.T. 1988 revoked. Rev. Rul. 69-473, 1969-2 C.B. 37. 61, 162, 170, ’86 Code.) Clarified by Rev. Rul. 71–135. §1.170-1. (Sec. Rev. Rul. 55–138, 1955–1 C.B. 223; Rev. Rul. 170, ’86 Code.) 80.318 Unreimbursed expenses; qualifica- 68-69, 1968-1 C.B. 80. Rev. Rul. 58–240, 1958–1 C.B. 141. tion as contributions “to” a charity.The Service will follow the decision of the U.S. Court of 80.324 Valuation; fair market value; donated 80.311 Unreimbursed expenses; church con- Appeals for the Second Circuit in Rockefeller v. property. A taxpayer who had voting control of a vention. Expenses of persons attending church Commissionrer that unreimbursed expenses corporation and an exempt private foundation conventions, assemblies, or other meetings, who incurred in rendering services to charitable orga- donated shares of the corporation’s stock to the are not attending as a duly chosen representative nizations were contributions made “to” the chari- foundation and, pursuant to a prearranged plan, of a congregation or other official church body, do table organizations. Rev. Ruls. 56-508, 57-38, caused the corporation to redeem the shares from not constitute charitable contributions but are non- 58-279, 67-362, 67-364, 69-473, 70-519, the foundation. The most recent transaction involving the stock was a redemption of stock held 80.333 War veterans’ organizations Con- by the estate of a past shareholder that was subject tributions to an organization, 90 percent of the to a prior cross-option agreement between the cor- membership of which is comprised of war veter- poration and the estate. Held, the transfer to the ans of the Armed Forces of the U.S., are deductible foundation was a valid gift of stock, not the pro- under section 170(c)(3). The fact that a small per- ceeds of the redemption, and the taxpayer realized centage of members have not served in a branch of no income from the redemption. The prior the Armed Forces during war time will not pre- redemption was not a comparable sale from which clude the organization from being classified as a the fair market value of the stock can be deter- war veterans organization. Rev. Rul. 59–151 mined. (Secs. 170, 302, 331; ’86 Code.) modified and superseded. §1.170A-1. (Secs. 170, Daniel D. Palmer, 62 T.C. 684; Acq. issue 1, 2522; ’86 Code.) Nonacq. issue 2; 1978-1 C.B. 2. Rev. Rul. 84-140, 1984-2 C.B. 56. 80.325 Valuation; guidelines. Guidelines are 80.334 Year of deduction. A charitable con- provided for persons making appraisals of donated tribution in the form of a check is deductible in the property for Federal income tax purposes. taxable year in which the check is delivered pro- §1.170-1. (Sec. 170, ’86 Code.) vided the check is honored and paid and there are Rev. Proc. 66-49, 1966-2 C.B. 1257. no restrictions as to time and manner of payment thereof. §§39.23(o)–1, 39.23(q)-1. (Secs. 23(o), 80.326 Valuation; property normally held for 23(q), ’39 Code; Sec. 170, ’86 Code.) sale. The fair market value of property normally Rev. Rul. 54-465, 1954-2 C.B. 93. sold by a taxpayer that is contributed to a charita- ble organization is its lowest usual selling price not 80.335 Year of deduction; charges to bank reduced by a discount for prompt payment offered credit card. A contribution made to a qualified to customers. §1.170-1. (Sec. 170, ’86 Code.) charity by a charge to a bank credit card is deduct- Rev. Rul. 69–514, 1969–2 C.B. 36. ible as a charitable contribution under section 170(a) in the year the charge is made regardless of 80.327 Valuation; restricted securities. when the bank is repaid. Rev. Rul. 68–174 distin- Guidelines are set forth for the valuation, for Fed guished and Rev. Rul. 71–216 revoked. eral tax purposes, of securities that cannot be §§1.170A-1, 301.7805-1. (Secs. 170, 7805; ’86 immediately resold because they are restricted Code.) from resale pursuant to Federal Securities laws. Rev. Rul. 78-38, 1978-1 C.B. 67. Rev. Rul. 59–60 amplified. §1.170A-1. (Secs. 170, 2031, 2032, 2512; ’86 Code.) Rev. Rul. 77-287, 1977-2 C.B. 319. 80.328 Valuation; restrictions on use. When a donor places a restriction on the use of property, the amount of the charitable contribution deduc- tion is the fair market value of the property at the time of the contribution determined in light of the restriction. §1.170A-1. (Sec. 170, ’86 Code.) Rev. Rul. 85-99, 1985-2 C.B. 83. 80.329 Valuation; “stapled,” “paired,” or “back-to-back” stock. Factors are set forth that should be considered, in addition to those in Rev. Rul. 59-60, in valuing the stock of a subsidiary corporation that is distributed to the shareholders of the former parent and that can be sold only with the stock of the distributing corporation. Rev. Rul. 59-60 amplified. §1.301-1. (Sec. 301, ’86 Code.) Rev. Rul. 80-213, 1980–2 C.B. 101. 80.330 Valuation; unimproved real property; market data approach. Guidance is provided to utilize the market data approach in appraising unimproved real property. §1.170A-1. (Sec. 601.105 S.P.R.; Secs. 170, 2031, 2512, ’86 Code.) Rev. Proc. 79-24, 1979-1 C.B. 565. 80.331 Volunteer fire company. Contributions or gifts to nonprofit volunteer fire companies are for the use of a political subdivision of a State for exclusively public purposes and are deductible as charitable contributions. I.T. 4030 superseded. Clarified by Rev. Rul. 74-361. §1.170-1. (Sec. 170, ’86 Code.) Rev. Rul. 71-47, 1971-1 C.B. 92. 80.332 Volunteer fire company. A nonprofit organization, organized and operated as a volun- teer fire company to provide fire protection and ambulance and rescue services to a community, qualifies for exemption as a charitable organiza- tion, contributions to which are deductible. It may also qualify for exemption as a social welfare organization conducting weekly public dances which do not constitute an unrelated trade or busi- ness. Rev. Ruls. 66–221 superseded and 71–47 clarified. §§1.170A-1, 1.501(c)(3)-1, 1.501(c)(4)–1, 1.513-1. (Sec. 23(o), ’39 Code; Sees. 170, 501, 513, ’86 Code.) Rev. Rul. 74–361, 1974-2 C.B. 159; Roy C. McKenna, 5 T.C. 712, Acq., 1974-2 C.B. 3.