The Tax Law of Charitable Giving. Bruce R. Hopkins

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Название The Tax Law of Charitable Giving
Автор произведения Bruce R. Hopkins
Жанр Личностный рост
Серия
Издательство Личностный рост
Год выпуска 0
isbn 9781119756026



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For example, in one instance, when checks were written immediately prior to an individual's death, there were inadequate funds in the account, and the checks were not presented for payment until approximately eight months after death. The value of the noncharitable gift of the checks was held by the IRS to be includible in the decedent's estate.20

      There are some items of property as to which the law has constructed a formal system for the transfer of title. This is the case in connection with stocks, bonds, and other securities (which are forms of intangible personal property). A security usually is evidenced by a certificate; title to the underlying security can be transferred by an endorsement on the certificate, indicating transfer of the security from one person to another. Transfers of securities are usually effected by brokers.

      Thus, a person may contribute a security to a charitable organization and thereby create a federal income tax contribution deduction when the properly endorsed certificate evidencing the security is delivered to the charitable organization. Delivery can also be accomplished by transfer of the security to an agent of the charitable donee.

      Court cases illustrate the intricacies of these rules. In one instance, an individual decided to contribute some stock to several charities, wanting to make these gifts before a payment of money for some of the shares pursuant to a tender offer and before accrual of the right to dividend income from the shares. The donor sent a letter to a trust company withdrawing the stock from a trust and requesting delivery of the stock to a bank. On the same day, the donor wrote to the bank identifying the charitable donees. Further, on the same day, the donees were sent a memorandum directing them to instruct the bank as to the disposition of the stock (that is, whether the donees wanted to accept the tender offer or retain the stock). The final offer was made about one week later, with the actual transfer of the shares on the corporation's books made approximately one month following the sending of the letters and memorandum by the donor. In the interim, dividends were declared; they were sent to the charities by the bank. The donor claimed a charitable deduction for the gifts of the securities and did not report the dividends as income.