What not to do when donating property

Description

Abstract: Charitable donations can provide real estate owners with valuable tax deductions — if the donors meet IRS requirements for taking such deductions. This article discusses a case in which the U.S. Tax Court disallowed a couple’s charitable deductions for their donations due to their failure to comply with IRS appraisal requirements — despite the fact that they likely undervalued the donations on their income tax returns. The article shows where the couple went wrong, and thus underscores the importance of obtaining appraisals from qualified appraisers before donating real estate. A sidebar lists the requirements for an appraiser to be “qualified.” Citation: T.C. Memo. 2012-152, 5/29/12