Charitable Giving Law Made Easy

THE INS AND OUTS OF CHARITABLE GIVING LAW--MADE EASY!
Written by renowned author Bruce R. Hopkins, Charitable Giving Law Made Easy is a must-read guide for accountants, consultants, investors, nonprofit executives, and fundraising professionalsanyone needing to know the essentials of the laws involving charitable giving. This authoritative guide presents in-depth discussions on such hot topics as the timing of charitable deductions, estate and gift tax considerations, special property rules, and planned giving. It also includes crucial information on deduction reduction rules, the twice-basis deductions, uses of life insurance, and international charitable giving.

• Designed to get you quickly up to speed, you will discover:
• How to handle the complex legal issues involved when individuals give money or property to charitable organizations
• Invaluable information on unique charitable gift situations
• Advice on how to navigate valuation, disclosure, reporting, and other regulatory issues
• The many new laws and law provisions just enacted by Congress

Packed with practical tips and hard-to-find advice, Charitable Giving Law Made Easy sheds light on complex legal issues concerning charitable giving with plain-language explanations of laws and regulations for non-legal professionals.

Preface ix
About the Author xi
Chapter 1 Charitable Giving Law: Basic Concepts 1
Charitable Organizations 2
Charitable Contributions 2
Introduction to Charitable Deductions 4
Private Foundations 5
Public Charities 5
What Difference Does It Make? 10
Types of Donors 10
Factors Affecting Deductibility of Contributions 11
Grantor Trust Rules 12
Donor-Advised Funds 12
Charitable Giving Subtleties 14
Charitable Pledges 18
Public Policy Considerations 18
Some Statistics 21
Summary 22
Chapter 2 Contributions of Money and Property 23
Contributions of Money 23
Nature of Property 24
Contributions of Property in General 25
Contributions of Long-Term Capital Gain Property in General 27
Contributions of Ordinary Income Property 27
Certain Contributions of Capital Gain Property 31
Contributions of Property for Unrelated Use 33
Step Transaction Doctrine 35
Valuation of Property 41
Summary 44
Chapter 3 Timing of Charitable Deductions 45
Overview 46
Contributions of Money in General 47
Contributions of Money by Check 47
Contributions by Debit or Credit Card 48
Contributions of Money by Telephone 49
Contributions of Securities 49
Contributions of Copyright Interests 52
Contributions by Means of Notes 52
Contributions by Letters of Credit 53
Contributions of Property Subject to Option 53
Contributions of Credit Card Rebates 56
Contributions of Tangible Personal Property 57
Contributions of Real Property 57
Timing Set by Statute 57
Contributions by Corporations 58
Contributions by Partnerships 59
Contributions by Means of the Internet 61
Summary 62
Chapter 4 Percentage Limitations on Charitable Deductions 63
Introduction 63
Individuals' Contribution Base 66
Corporations' Taxable Income 67
Overview of Percentage Limitations 67
50 Percent Limitation 69
30 Percent Limitation for Gifts of Certain Property 71
Electable 50 Percent Limitation 74
General 30 Percent Limitation 78
Interplay of 50 Percent/Special 30 Percent Limitations 79
Interplay of 50 Percent/General 30 Percent Limitations 79
Interplay of Special 30 Percent/General 30 Percent Limitations 80
20 Percent Limitation 80
Contributions for Use of Charity 81
Blending Percentage Limitations 81
Individuals' Net Operating Loss Carryovers and Carrybacks 83
Rules for Spouses 84
Information Requirements 86
Percentage Limitation for Corporations 87
Corporations' Net Operating Loss Carryovers and Carrybacks 88
Illustrations 89
Summary 91
Chapter 5 Estate and Gift Tax Considerations 92
Introduction to Taxes 92
Federal Gift Tax 94
Federal Estate Tax 103
Unification of Taxes 110
Estate Planning Principles 111
Remainder Interests 119
Ascertainability of Charitable Interests 123
Generation-Skipping Transfer Tax System 125
Summary 128
Chapter 6 Special Property Rules 129
Works of Art 129
Vehicles 131
Intellectual Property 135
Automobile Expenses 137
Inventory 138
Scientific Research Property 142
Computer Technology or Equipment 142
License to Use Patent 143
Real Property Used for Conservation Purposes 145
S Corporation Stock 149
Use of Property 154
Property Subject to Debt 154
Future Interests in Tangible Personal Property 157
Summary 158
Chapter 7 Unique Charitable Gift Situations 159
Contributions from Retirement Accounts 159
Donors' Creations 160
Charity Auctions 161
Services 167
Unreimbursed Expenses 168
Limit on Deduction Due to Pleasure 172
Bargain Sales 176
Contributions by Trusts 180
Partial Interests 186
Charitable Family Limited Partnerships 189
Foreign Tax Credit 191
Summary 192
Chapter 8 Other Aspects of Deductible Giving 193
Contributions by Means of Agent 194
Gifts for the Use of Charity 195
Conditional Gifts 197
Earmarking of Gifts for Individuals 200
Deduction Reduction Rules 204
Twice-Basis Deductions 204
Alternative Minimum Tax Considerations 205
Business Expense Deduction 207
Lobbying Activities 207
Corporate Sponsorships 208
Gifts to Noncharitable Organizations 212
Reallocation of Deductions 214
Funding of Terrorism 215
Statute of Limitations 215
Concept of Trust Income 216
Penalties 219
Summary 224
Chapter 9 Planned Giving 225
Introduction 225
Charitable Remainder Trusts 228
Early Termination of Remainder Trusts 234
Pooled Income Funds 235
Charitable Gift Annuities 238
Other Gifts of Remainder Interests 239
Charitable Lead Trusts 243
Application of Securities Laws 243
Application of Antitrust Laws 245
Summary 246
Chapter 10 Gifts of and Using Life Insurance 247
Introduction 247
Life Insurance Concepts 248
Charitable Giving and Life Insurance 251
Insurable Interest 257
Unrelated Debt-Financed Income Considerations 261
Charitable Split-Dollar Insurance Plans 261
Summary 269
Chapter 11 International Charitable Giving 270
Introduction 270
Background 271
Earmarking and Conduit Restrictions 273
Control over Foreign Donees 276
Income Tax Treaties 280
Estate and Gift Tax Considerations 281
Estate Tax Rules 281
Gift Tax Rules 286
Charitable Giving by Noncitizen Nonresidents 287
Corporate Gifts to U. S. Charity for Overseas Use 288
Gifts of Goods or Services to Benefit Foreign Charity 289
Grants of Funds from U. S. Corporation-Related Foundations to Foreign Charity 290
Summary 299
Chapter 12 Administration of Charitable Giving Programs 300
Burden of Proof Rules 300
Gift Substantiation Requirements 301
Disclosure of Gifts of Property 307
Dispositions of Contributed Property 309
Appraisal Requirements 310
Offering of Information or Services 315
Tax Shelters 315
Quid Pro Quo Contribution Rules 317
Disclosure by Noncharitable Organizations 320
State Fundraising Regulation 323
Summary 336
Glossary 337
Epilogue 339
Index 352