This article is the first of a two-part series on substantiating noncash gifts. Part two focuses on the special rules related to donations of noncash "personal property"—such as clothing, cars, boats, household items, and stock.

A US Tax Court judge disallowed a deduction—albeit reluctantly—of $18.5 million for donations of real estate. The donors, Joseph and Shirley Mohamed, a philanthropic couple whose charitable causes included Shriners Hospitals for Children and the Sacramento Food Bank, had donated real estate worth $20.3 million several years before. They had claimed an $18.5 million deduction on their federal tax return.

The Mohameds failed to get the required appraisals for their property at the time of donation. And they lacked the mandated documentation at the time of filing. (Joseph Mohamed said he self-prepared the couple's taxes and had failed to read instructions.)