Revenue Procedure 90-12
Internal Revenue Service
1990-1 C.B. 471 (1990)
- Written by Abby Roughton, JD
Facts
In Revenue Ruling 67-246, the Internal Revenue Service (IRS) advised that a taxpayer may claim a charitable-contribution deduction under § 170 of the Internal Revenue Code for a payment made in connection with admission to or participation in a charity fundraiser only to the extent that the value of the taxpayer’s payment exceeds the fair market value of the privilege or benefit received by the taxpayer. The IRS advised charities to determine the fair market value of the benefits offered to contributors and to include information in charities’ solicitations, tickets, receipts, and other documents provided to contributors about how much of a contributor’s contribution would and would not be deductible under § 170. Many charities advised the IRS that calculating the fair market value of benefits offered to contributors was difficult, especially when the benefits had merely token value relative to the amounts being contributed. In response to the information received from the charities, the IRS issued a revenue procedure discussing how charities should advise contributors in situations in which the charities offered small token items or benefits in exchange for contributions.
Rule of Law
Issue
Holding and Reasoning ()
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