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Posted by Paul Thomas, CPA on January 16, 2008, 10:04 am
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>I have a potential client who want to "lend her home" for an extended
> period, three months, to a 501c3 to run a House Tour operation. The
> 501c3 will be fixing up the house with furniture and decorations,
> charging admissions, holding fundraisers etc. The owner will have to
> rent temporary accommodations, move her "stuff out" and move back in.
> Likely she'll pay the utilities as well.
>
>
> Do we have any history on the tax treatment of this situation.
Yeah, like everyone does this all the time.
Must be a nice place is al I can say.
Have the charity address her rental of lodging as "for the benefit of" the
charity - this event specifically - as well as addressing the issues of who
covers the utilities, moving costs, etc on the house for the quarter of the
year (seems quite long to me). That written statement - besides being
necessary - might help prove that the expense was incurred on behalf of, and
for the benefit of, the charity.
That or seal the deal by writing checks to the charity and have them pay the
expenses themselves.
--
Paul A. Thomas, CPA
Athens, Georgia
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Posted by Harlan Lunsford on January 16, 2008, 4:58 pm
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ChenangoBusinessServices@hotmail.com wrote:
> I have a potential client who want to "lend her home" for an extended
> period, three months, to a 501c3 to run a House Tour operation. The
> 501c3 will be fixing up the house with furniture and decorations,
> charging admissions, holding fundraisers etc. The owner will have to
> rent temporary accommodations, move her "stuff out" and move back in.
> Likely she'll pay the utilities as well.
>
>
> Do we have any history on the tax treatment of this situation.
>
>
> Noel Nichols
> Chenango Business Services
>
What's interesting to me is that you say you have a "potential client".
This sounds like he's shopping around to see who will give a favorable
thumbs up to such a deduction.
I wouldn't.
ChEAr$,
Harlan Lunsford, EA n LA
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<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
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<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
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Posted by ChenangoBusinessServices@hotma on January 16, 2008, 11:13 pm
Please log in for more thread options "What's interesting to me is that you say you have a "potential
client".
This sounds like he's shopping around to see who will give a
favorable
thumbs up to such a deduction."
Actually I don't think She is that crafty. The benefit I think she
gets is
the publicity and community recognition for beings a "Grand Dam" of
the community
and a Princes in her circle of "friends"
I just asked "the question" of her to see if there had been any
consideration
CBS
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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
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<< Copyright (2007) - All rights reserved. >>
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Posted by Bill Brown on January 18, 2008, 12:18 am
Please log in for more thread options On Jan 15, 7:48 pm, "ChenangoBusinessServi...@hotmail.com"
> I have a potential client who want to "lend her home" for an extended
> period, three months, to a 501c3 to run a House Tour operation. The
> 501c3 will be fixing up the house with furniture and decorations,
> charging admissions, holding fundraisers etc. The owner will have to
> rent temporary accommodations, move her "stuff out" and move back in.
> Likely she'll pay the utilities as well.
>
> Do we have any history on the tax treatment of this situation.
>
> Noel Nichols
> Chenango Business Services
Based on the facts you present the taxpayer would likely have a
deduction for the costs of moving her stuff out and back in (along
with storage costs in the interim). She might also be able to deduct
cost of renting and maintaining her temporary living quarters.
There would be no deduction for the rental value of her home.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by Mark Bole on January 19, 2008, 9:04 pm
Please log in for more thread options Bill Brown wrote:
> On Jan 15, 7:48 pm, "ChenangoBusinessServi...@hotmail.com"
>> I have a potential client who want to "lend her home" for an extended
>> period, three months, to a 501c3 to run a House Tour operation. The
>> 501c3 will be fixing up the house with furniture and decorations,
>> charging admissions, holding fundraisers etc. The owner will have to
>> rent temporary accommodations, move her "stuff out" and move back in.
>> Likely she'll pay the utilities as well.
>>
>> Do we have any history on the tax treatment of this situation.
>>
>> Noel Nichols
>> Chenango Business Services
>
> Based on the facts you present the taxpayer would likely have a
> deduction for the costs of moving her stuff out and back in (along
> with storage costs in the interim). She might also be able to deduct
> cost of renting and maintaining her temporary living quarters.
I can't find anything to support this in Pub 526, but I haven't checked
tax law.
Even if we greatly stretch the meaning of "services" to include
rent-free use of real property, it's stated several times that
deductible out-of-pocket expenses related to providing a service to a
charity must "not [be] personal, living, or family expenses."
Furthermore, you can only deduct the amount of a contribution that is
more than the value of the benefit you receive, so I suppose flying to
New York and renting a Manhattan penthouse for three months would not be
fully deductible as a charitable contribution. The fair market rental
value of her house less her temporary lodging expense might be
deductible, but only if it is a positive number.
In a house large enough to accomodate "tours" for paying customers, why
can't she simply put some personal items in storage, lock her bedroom
door and liquor cabinet during the day, and then come home each evening
to spend the night? She's already agreeing to let the general public
tromp through her house, I don't see how moving out is "directly
connected with the services" provided (again, stretching the meaning of
"services" almost beyond recognition).
Before researching the tax treatment of this situation, I'd advise the
potential client to check whether she will have additional homeowner's
insurance requirements. As a side note, I also question how much of the
admission charged for house tours is deductible to the payees...
Smetimes I remind people that the the primary purpose of contributing to
a charitable organization is not to get a tax deduction.
-Mark Bole
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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