By Richard R. Hammar, J.D., LL.M., CPA
© Copyright 2001 by Church Law & Tax Report. All rights reserved. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is provided with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. Church Law & Tax Report, PO Box 1098, Matthews, NC 28106. Reference Code: m08 c0103
Substantiating contributions of property. A taxpayer claimed a substantial charitable contribution deduction on his income tax return. The IRS later audited his return, and challenged his deduction. The taxpayer claimed that the deduction was for contributions of various items of property he had made to local churches. His only support for these contributions, however, were "receipts" bearing the churches' letterhead and on which he had written descriptions and values for the donated items. This was not enough to substantiate the contributions, the IRS concluded. A federal appeals court agreed. It noted that "the taxpayer offered 'tax receipts' bearing the charities' letterheads on which he listed the items donated and their values," and concluded that these "self-generated receipts" were too unreliable to support a charitable contribution deduction. Tokh v. Commissioner, 2001-1 USTC 50,128 (7th Cir. 2001).