Case of Perry Walter Payne et ux. v. Commissioner (T.C. Summ. Op. 2016-30) (No. 25006-14S) (United States Tax Court) (Section 170 — Charitable Deduction)

A recent case in the United States Tax Court regarding Charitable Deductions upheld the IRS’s ruling that disallows most of a couple’s non cash charitable contribution deductions. The case is summarized,

The Tax Court, in a summary opinion sustaining accuracy-related penalties, upheld the IRS’s disallowance of most of a couple’s noncash charitable contribution deductions, which totaled $169,000 for two tax years, finding that the couple failed to meet the recordkeeping and substantiation requirements for their deductions.

GERBER, Judge: This case was heard pursuant to the provisions of section 7463 of the Internal Revenue Code in effect when the petition was filed.  n1 Pursuant to section 7463(b), the decision to be entered is not reviewable by any other court, and this opinion shall not be treated as precedent for any other case.

Respondent determined income tax deficiencies for petitioners’ 2010 and 2011 tax years of $ 14,008.12, and $ 18,651, respectively. Respondent also determined accuracy-related penalties under section 6662(a) for 2010 and 2011 of $ 2,801.62, and $ 3,730.20, respectively. In an amendment to answer, filed August 12, 2015, respondent asserted increases in the income tax deficiencies for 2010 and 2011 of $ 8,361 and $ 8,137, respectively. Respondent also asserted increases in the section 6662(a) accuracy-related penalties for 2010 and 2011 of $ 1,672.20 and $ 1,627.40, respectively.

The issues  n2 for consideration are (1) whether petitioners are entitled to various noncash charitable contribution deductions for 2010 and 2011 and (2) whether petitioners are liable for accuracy-related penalties for 2010 and 2011.

The full tax court summary opinion can be found here: T.C. Summary Opinion 2016-30

Posted by Allison Trupp, Associate Editor, Wealth Strategies Journal

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