Sunday, January 29, 2012

Unrealized Gain in Charitable Deductions

Unrealized gain in donated property is deductible only if:

  1. The gain would have been long-term capital gain had the taxpayer sold the property;
  2. In the case of a contribution of tangible personal property (not land):
    1. Use of property by charity is related to its tax-exempt purpose, AND
    2. Property is not given to a private foundation, which are a category of charities with special treatment in a number of respects including charitable property deductions.
  3. You can’t get unrealized appreciation of personal property through deduction if giving this way to a private organization. 

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