Substantiation of certain charitable contributions.The Revenue Reconciliation Act of 1993 requires taxpayers to obtain written acknowledgment acknowledgment, in law, formal declaration or admission by a person who executed an instrument (e.g., a will or a deed) that the instrument is his. The acknowledgment is made before a court, a notary public, or any other authorized person. for charitable contributions charitable contribution n. in taxation, a contribution to an organization which is officially created for charitable, religious, educational, scientific, artistic, literary, or other good works. of $250 or more effective Jan. 1, 1994. Recently released Temp. Regs. Sec. 1.170A-13T provides guidance on how contributions made by payroll deductions are to be substantiated; how to apply the $250 threshold to contributions made through payroll deductions; and who the donee The recipient of a gift. An individual to whom a power of appointment is conveyed. donee n. a person or entity receiving an outright gift or donation. DONEE. organization is when contributions are made to a charitable organization This article is about charitable organizations. For other uses of the word charity, see Charity. A charitable organization (also known as a charity) is an organization with charitable purposes only. which then distributes the money to another charitable organization. Generally, no deduction is allowed for any charitable contribution of $250 or more unless the taxpayer substantiates the contribution with a contemporaneous con·tem·po·ra·ne·ous adj. Originating, existing, or happening during the same period of time: the contemporaneous reigns of two monarchs. See Synonyms at contemporary. written acknowledgment of the contribution from the donee organization. The acknowledgment must include the amount of cash and a description of any property contributed; whether any property, goods or services were provided by the donee organization in return for the contribution; and a description and good faith estimate of the value of any goods or services provided or, if the goods and services In economics, economic output is divided into physical goods and intangible services. Consumption of goods and services is assumed to produce utility (unless the "good" is a "bad"). It is often used when referring to a Goods and Services Tax. consist solely of an intangible religious benefit, a statement to that effect. Since the taxpayer will not get a receipt from a donee organization for contributions made through payroll deductions, Temp. Regs. Sec. 1.170A-13T(b)(1) allows this type of contribution to be substantiated through the use of two documents. The contribution can be substantiated with a pay stub A small software routine placed into a program that provides a common function. Stubs are used for a variety of purposes. For example, a stub might be installed in a client machine, and a counterpart installed in a server, where both are required to resolve some protocol, remote procedure , W-2 or other document furnished fur·nish tr.v. fur·nished, fur·nish·ing, fur·nish·es 1. To equip with what is needed, especially to provide furniture for. 2. by the employer that indicates the amount that was withheld for the purpose of the payment to the donee organization, and a pledge card or other document furnished by the donee organization that indicates that no goods or services were provided as consideration for the contribution made to the organization by a payroll deduction. Temp. Regs. Sec. 1.170A-13T(b)(2) also indicates that contributions made by payroll deduction will not be aggregated. This means that someone could make contributions during the year that would total more than $250, but if no contribution for any pay period was more than $250, the substantiation requirements would not apply. Temp. Regs. Sec. 1.170A-13T(c) also clarifies who the donee organization is when contributions are made to a conduit organization. Even if the donor instructs the conduit organization as to where the funds will be distributed, for purposes of the substantiation requirements the donee organization is the conduit organization. If a transaction is intentionally structured, whereby the donor contributes to the conduit organization, instructs the conduit to distribute the funds to a specific donee organization and receives goods or services from such donee organization, such organization is considered the donee organization for purposes of the substantiation requirements. Example: Taxpayer T contributed $5,000 to charitable organization A and instructed A to distribute the $5,000 to charitable organization B. T received goods or services from B in return for the contribution. Thus, B is considered the donee organization, and T is required to obtain substantiation from B, not A, which originally received the $5,000. Effectively, the new regulations appear to have made it a bit easier to avoid the substantiation rules when the facts warrant it. (See also Kamerow, "Substantiation and Disclosure Requirements for Charitable Contributions," p. 637, this issue.) From Timothy W. Mulcahy, CPA (Computer Press Association, Landing, NJ) An earlier membership organization founded in 1983 that promoted excellence in computer journalism. Its annual awards honored outstanding examples in print, broadcast and electronic media. The CPA disbanded in 2000. , Holtz Rubenstein & Co., New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , N.Y. |
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