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Nonprofit Law/real estate donation to County

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QUESTION: If I donate one acre of land to the county for road improvement can I take off the appraised value of the land at the time I donate it or do I have to use a formula for what the land was worth when I obtained it as to what it is worth at the time i donate it and how much in dollars can I donate I one tax year

ANSWER:  As to charitable deductions, see IRS Publication 526 "Charitable
Donations"  which is available at:
http://www.irs.gov/pub/irs-pdf/p526.pdf on page two in the middle chart - donations are deductible when given to

Federal, state, and local
governments, if your contribution is
solely for public purposes (for
example, a gift to reduce the public
debt)

Road improvement is for public purposes.

See IRS Publication 561, "Determining the Value of Donated
Property", which is available at www.irs.gov/pub/irs-pdf/p561.pdf
and which discusses on page 2 that the deduction for donations of
property is in the amount of the fair market value. The rest of the
publication addresses certain types of property that would not be
applicable in your case.

Harvey Mechanic, Attorney at Law -
Harvey108@hotmail.com

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.    




---------- FOLLOW-UP ----------

QUESTION: If the property was worth say $1.000 when I obtained the property but it is worth $10.000 at the time I donate it do I get to claim the entire amount as a donation or do I have to work a formula for what I can claim as a donation.

Answer
You get the entire $10,000 deduction as that is what your appraisal shows as the fair market value.  You can see that the written appraisal is required on page 6 of that Publication 561:
--- Start of Excerpt ---
Real Estate
Because each piece of real estate is unique and
its valuation is complicated, a detailed appraisal
by a professional appraiser is necessary.
The appraiser must be thoroughly trained in
the application of appraisal principles and the-
ory. In some instances the opinions of equally
qualified appraisers may carry unequal weight,
such as when one appraiser has a better knowl-
edge of local conditions.
The appraisal report must contain a com-
plete description of the property, such as street
address, legal description, and lot and block
number, as well as physical features, condition,
and dimensions. The use to which the property
is put, zoning and permitted uses, and its poten-
tial use for other higher and better uses are also
relevant.
In general, there are three main approaches
to the valuation of real estate. An appraisal may
require the combined use of two or three meth-
ods rather than one method only.
---End of Excerpt---

Harvey Mechanic, Attorney at Law - Harvey108@hotmail.com

P.S. This response is intended to be a general statement of law, should not be relied upon as legal advice and does not create an attorney/client relationship.  

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Harvey Mechanic

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I am an attorney and I volunteer time to answer general questions about U.S. Federal income tax issues of nonprofit 501(c)(3) public charities only. Those questions could be about establishing and maintaining legal requirements for such non-profit organizations in the United States, including Internal Revenue service filings and requirements. I will not be working on this free forum to answer questions about Nonprofit's possible unrelated or for-profit businesses or how to fill out forms. This forum is only for general questions about federal tax law, not as the law applies to your specific situation. If you do not make your question public then I will not be spending much of my donated time on answers that would not benefit the public. If you have other questions, please contact me at Harvey108@hotmail.com I will reply from my email. In any case, do not reveal confidential information to me until after I have contracted with you to provide personal legal services. My responses on this forum are intended to be general statements of law, should not be relied upon as legal advice, and do not create an attorney/client relationship. For me to consider your individual situation and how the law applies, I would need to gather extensive information about the situation. To search my previous answers you can do a Google search by "site:allexperts.com/q/nonprofit" without the quotes and then add your search terms before hitting enter.

Experience

I have been practicing law and especially the law of nonprofit organizations since 1990 when I was admitted to the New York Bar and I have maintained my status with the Bar since that time.

Education/Credentials

B.S. Columbia University in New York City, 1970

J.D. (Law Degree) Brooklyn Law School, 1990 -- Cum Laude.


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