Donors taxed on gain even though stock given to charity
Article Abstract:
Advance planning for charitable gifts is very important to the achievement of optimal tax results. Regulation 1.170A-1(b) holds that charitable gifts are completed when taxpayers deliver or mail properly endorsed certificates to the charitable donees or the the donees' agents. In one case, individuals who donated corporate stock to charities immediately before a merger in a tender offer were taxed on the gain from the sale of stock under the 'anticipatory assignment' doctrine. Had these taxpayers made the stock donations much sooner prior to the merger completion, they would have avoided gain recognition. Further, they did not provide their broker with clear, written instructions, with copies for themselves. Thus, when they invoked legal intervention, the stockbrokers' contradictory testimony regarding his role as agent and the date of the receipt of formal authorization weakened their case.
Publication Name: Practical Tax Strategies
Subject: Law
ISSN: 0040-0165
Year: 1999
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No refund of excess interest paid on tax deferred by installment method
Article Abstract:
The IRS ruled in TAM 9853002 that an individual who chose an installment sale method was not eligible to a refund of interest paid in an earlier year on the deferred tax liability because the taxpayer estimated that he would not received the selling price he utilized to determine the deferred tax liability originally. Several factors influenced the interest due. These include the sales price of the property, the obligation outstanding at the closing of the tax year and the total face amounts of installment obligations held by the individual. In addition, the IRS discussed the implications of giving the individual a retroactively change in interest payments and the fair market value of the contingent payment obligation.
Publication Name: Practical Tax Strategies
Subject: Law
ISSN: 0040-0165
Year: 1999
User Contributions:
Comment about this article or add new information about this topic:
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