To: S. Partner, C. L. A.
By: Nicole J. Badalamenti, M. Accountant
Particular date: August twenty-seven, 2012
Subject: Mr. M. Potato
Mr. B. Potato, a prosperous real estate investor, recently purchased a residence on a courier of area for $400, 000. The house was appraised at a worth of 300 dollar, 000 and the land had an appraised benefit of hundred buck, 000. Mister. Potato programs to destroy the house and replace it with a brand new house really worth $1, 500, 000 together with the intentions of living in this personally. Having to pay to have the home bulldozed would cost Mr. Potato a considerable amount of money. It has been suggested to Mr. Potato to permit the Troy Fireplace Department rights to execute training physical exercises on the area, and as a part of those teaching exercises, to burn the house down to cinders.
1 . Is Mr. B. Potato entitled to a charitable contribution deduction to get the gift of his property towards the Troy Fire Department to conduct teaching exercises within the land including burning your house down to cinders? 2 . Is definitely Mr. N. Potato susceptible to negligence or substantial understatement penalties in the event the deduction is taken, however not allowed?
1 . Mister. B. Spud is certainly not entitled to a charitable contribution deduction for the charite of the make use of his house to the Troy Fire Division to conduct training physical exercises that include burning up his house to ground. 2 . Mr. Potato will be liable for accuracy-related penalty for negligence and substantial tiefstapelei if the discount is considered, but then prohibited.
A. IS MR. POTATO ENTITLED TO A CHARITABLE CONTRIBUTION DEDUCTION TO GET THE GIFT OF THE UTILIZATION OF HIS HOME TO THE TROY FIRE DIVISION TO EXECUTE TRAINING EXERCISES?
IRC Sec. 170(a)(1) provides, in relevant portion, that discount is acceptable for any charity contribution, repayment that is built within the taxable year. " Charitable contributionвЂќ is described in IRC Sec. 170(c)(1)...