Contribution type is what?

[FEDUKE404]

Jane is a loyal supporter of her church's Boy Scout troop, which is to have a fall outing event.

Jane is given a "shopping list" of what is needed, and visits her local super market to buy the necessary food and other supplies for her church to use specifically for the cookout for the Scouts. She does things of this nature frequently throughout the year.

After her purchase, she immediately takes everything to the church and they are grateful. All Jane has is a cash register receipt from Bob's Supermarket.

QUESTION: Does Jane have a cash contribution. . . .or a non-cash contribution?? RELATED: Does she need a "receipt" from the church??

(Jane is already dealing with a Form 8283 for other items, such as Goodwill stuff, she has donated. Goal is to keep the Form 8283 manageable IF the groceries can be considered a cash contribution.)

So far I cannot find anything that directly addresses this (obviously nit-picking) issue. Suggestions??

FE

[Jiggers]

She needs a receipt from the church. The store receipt isn't sufficient because she can write whatever she wants on the receipt.

[Lion]

Just something from the back of my mind, but I think these are actually "cash" contributions, because the food is not previously owned or used but new items that are worth what the store receipt says on her donation day per your scenario.

That said, even though each individual donation may be small and the year's worth might still be under $250, I also say she needs an acknowledgement from the church of her donation, letter on their letterhead, a line on her pledge/donation statement, a donation receipt from the church of some sort to show that they received the food from your client.

I would welcome anyone who can provide cites. I know the IRS is looking at charitable contributions and receipts. I need to be careful of my own contributions, as well.

[Gretel]

I agree, and this is a non-cash contribution. If this happens several times a year, I would total these grocery receipts and use as date the date from the last receipt.

[RitaB]

Jane is a loyal supporter of her church's Boy Scout troop, which is to have a fall outing event.

Jane is given a "shopping list" of what is needed, and visits her local super market to buy the necessary food and other supplies for her church to use specifically for the cookout for the Scouts. She does things of this nature frequently throughout the year...Goal is to keep the Form 8283 manageable IF the groceries can be considered a cash contributions... Suggestions??

FE

I agree, and this is a non-cash contribution. If this happens several times a year, I would total these grocery receipts and use as date the date from the last receipt.

I can see calling them cash donations; cost = FMV, date of purchase = date of donation. Also I can see lumping them all together as non-cash. I'm pretty sure both these options are technically wrong, but achieve the same purpose - which is to report the very obvious unquestionable amount in a way that won't cost your client more than the deduction saves in taxes, and allows you to move on to something worthy of your time. I get it. Yeah, she should be getting acknowledgements from church. Would be great if church just put the amounts on the donation summary, and you didn't know about the grocery runs at all. The things we deal with...

[Kram BergGold]

Non Cash

One to three years ago I posted a similar question on this Board. The overwhelming response was that recently purchased supplies
donated to a charity is non cash.

[taxea]

and....she would have to subtract the cost of any meals she purchases at the church if this concept applies.

[FEDUKE404]

Verdict is ??

1 - Treat all as non-cash contributions that end up on Form 8283 ??
2 - Column (i) of Part I shows "actual cost" ??
3 - Columns (e) (f) (g) of Part I can likely remain blank?

Client needs a receipt from church/organization for each such gift?
How does church/organization establish value of goods received to show on their receipt? (Walmart or Whole Foods cost for the received items?)

(I think I might recommend client just donate $$$ and let the organization do the shopping on their own. )

Thanks for the informative responses.

FE

[RitaB]

Ta-Da

One to three years ago I posted a similar question on this Board. The overwhelming response was that recently purchased supplies
donated to a charity is non cash.

Here it is, I enjoyed reading it:

http://forum.thetaxbook.com/showthread.php?25803-Charity-how-to-handle&highlight=non-cash

[Gretel]

1 - Treat all as non-cash contributions that end up on Form 8283 ??
2 - Column (i) of Part I shows "actual cost" ??
3 - Columns (e) (f) (g) of Part I can likely remain blank?

Client needs a receipt from church/organization for each such gift?
How does church/organization establish value of goods received to show on their receipt? (Walmart or Whole Foods cost for the received items?)

(I think I might recommend client just donate $$$ and let the organization do the shopping on their own. )

Thanks for the informative responses.

FE

I'll answer the second part: Yes, need receipt but church does not establish value, same as Thrift Store don't establish values.

[spanel]

I'll answer the second part: Yes, need receipt but church does not establish value, same as Thrift Store don't establish values.

Are you sure she is donating to the Church and not directly to the Boy Scouts? Most of the Scouts only "use" the church as a meeting place.

Does it matter if its the BSA instead of the Church? Would it matter that someone in her family is getting use (family members of the scouts)?

Chris

[New York Enrolled Agent]

Jane is a loyal supporter of her church's Boy Scout troop, which is to have a fall outing event.



QUESTION: Does Jane have a cash contribution. . . .or a non-cash contribution?? RELATED: Does she need a "receipt" from the church??

So far I cannot find anything that directly addresses this (obviously nit-picking) issue. Suggestions??

FE

FE - Is it fair to say that these expenses could be considered as the equivalent of unreimbursed volunteer expenses?

If yes, then I think the Tax Court has answered the question and the expenses are deemed to be money contributions. I'll paste a piece - I would advise you to read the whole case. Van Dusen 136 TC 515

Section 1.170A-13, Income Tax Regs., divides contributions of less than $250 into only two categories: "contributions of money" and "contributions of property other than money". See sec. 1.170A-13(a) and (b), Income Tax Regs. The regulations do not expressly state whether a contribution through the payment of unreimbursed volunteer expenses is subject to the requirements for contributing money set forth in section 1.170A-13(a), Income Tax Regs., the requirements for contributing non-money property set forth in section 1.170A-13(b), Income Tax Regs., or neither set of requirements. The idea that unreimbursed volunteer expenses are free from recordkeeping requirements is implausible. Therefore, one of the two sets of rules must govern those expenses.

Of the two sets of recordkeeping rules, we hold that section 1.170A-13(a), Income Tax Regs.--which sets forth the recordkeeping rules for money contributions--contains the relevant rules for determining whether unreimbursed volunteer expenses are deductible. These rules, and not the rules for nonmoney contributions, apply to unreimbursed volunteer expenses for several reasons.

Since these were contributions of money, the rules in §170(f)(8) also hold - contributions of $250 or more require a contemporaneous acknowledgment.

[Roland Slugg]

A few of my clients buy food for church (or other 501(c)(3) organization) functions. If the amounts are large ... i.e. $250+ ... or if they have other non-cash contributions, I always treat them as property contributions for the following two reasons: First, the organization is not given a cash contribution. It is given food ... a non-cash commodity. Second, for any contribution of $250 or more, the recipient organization must give the donor a receipt, form or letter acknowledging same, and for cash contributions, but not property contributions, that acknowledgment must state the amount of the contribution. Since the recipient would be unable to state the value of contributed food items, its acknowledgment form could not state an amount. Ergo, food contributions must be classified as property.

Despite that, most of my clients' purchases and donations of groceries are for small amounts ... typically $20 to $30 ... and in those cases I simply add that cost in with their other cash contributions, especially if they have no other non-cash contributions. After all, what difference does it make?