Attorney-at-Law

INDIAN GIVER

In Uncategorized on 05/25/2022 at 16:27

This formerly pejorative (not to say offensive and objectionable) phrase certainly does not apply to Martha L. Albrecht, T. C. Memo. 2022-53, filed 5/25/22. Martha did donate a substantial collection of Native American jewelry and artifacts to the Wheelwright Museum of the American Indian, as substantiated by a five-page deed of gift.

But the Wheelwright’s draftership falls short of the Section 170(f)(8)(B) contemporaneous written agreement standard. The deed does not say that no goods or services were provided by the Wheelwrights, although there’s no suggestion that there were. Nor does the deed state that there is no other agreement respecting the donation.

Judge Travis A. (“Tag”) Greaves plays the literalist here.

“Although the deed in this case provides that the donation was ‘unconditional and irrevocable,’ it continues that ‘all rights, titles and interests held by the donor in the property are included in the donation, unless otherwise stated in the Gift Agreement.’ (Emphasis added.) Thus, the terms of the deed were subject to a separate agreement, but the Wheelwright Museum did not provide petitioner with this document before the return was filed.” T. C. Memo. 2022-53, at pp. 4-5. (Footnote omitted, but it says that even though the parties stiped that Martha got nothing, that was after the fact, so it doesn’t help).

And that there never was a “Gift Agreement” doesn’t help either, because the deed says there was. Besides, the drafter of the deed made the rookie error of omitting an integration clause, which should say that this deed sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and may not be varied otherwise than in writing and signed by the party against whom any variation is asserted.

“We appreciate what appears to have been a good faith attempt by petitioner to substantially comply with the Code by executing the deed with the Wheelwright Museum. Substantial compliance, unfortunately for petitioner, does not satisfy the strict requirements of section 170(f)(8)(B). See 15 W. 17th St. LLC, 147 T.C. at 562. Thus, for the reasons given above, petitioner is not entitled to a charitable contribution deduction with respect to the donation as the deed does not satisfy these requirements.” T. C. Memo. 2022-53, at pp. 5-6.

For the 15 West 17th St. LLC story, see my blogpost “Executive Nullification,” 12/22/16.

Note well, I characterized that case as “one of those overblown façade farragoes.” With the façade and conservation chicanery, currently rife, IRS is going scalphunting. Charities and donors beware: those deeds of gift need to be bulletproof.

I’ll wager an ale or two that the drafter of this deed is getting The Phone Call.

 

 

 

 

 

 

  

 

 

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