The Tax Law of Charitable Giving, 6th Edition

CHAPTER THREEContributions of Money and Property

• § 3.1 Contributions of Money
• § 3.2 Contributions of Property in General
• § 3.3 Contributions of Long-Term Capital Gain Property in General
• § 3.4 Contributions of Ordinary Income Property
  • (a) Definition of Ordinary Income Property
  • (b) Deduction Reduction Rules
  • (c) Special Rules of Inapplicability
• § 3.5 Certain Contributions of Capital Gain Property
  • (a) General Deduction Reduction Rule
  • (b) Qualified Appreciated Stock
• § 3.6 Contributions of Property for Unrelated Use
  • (a) Special Rule
  • (b) Definition of Unrelated Use
  • (c) Recapture of Deduction
• § 3.7 Step Transaction Doctrine
• § 3.8 Charitable Pledges

This chapter summarizes the federal tax law concerning the determination of the income tax charitable deduction for contributions of money or property, when the donor is not retaining or creating any interest in the item being transferred. The calculation of this deduction must be made under these rules before application of the general percentage limitations.¹ Contributions of money or property, when the donor is creating an interest in the item being transferred, are subject to other rules.²

§ 3.1 CONTRIBUTIONS OF MONEY

A U.S. individual or corporation may make a contribution of money—usually U.S. currency—to a charitable organization. The income tax deduction for this donation is based on the amount of funds being transferred.

A gift of money in the form of currency of a country other than the United States (such as a contribution ...