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Meeting Substantiation Requirements

Lack of donation proof can cause tax problems.

Key point. Contributions to a church or other charity are not deductible unless they can be substantiated.

The Tax Court ruled that a volunteer music minister could not deduct most of his church contributions since he lacked sufficient proof that he made most of the contributions he claimed. A computer consultant (the taxpayer) served as a volunteer and unpaid minister of music at his church. In this position the taxpayer organized choirs, played music, and performed other music—related functions. A tenet of the taxpayer's church is tithing—contributing 10 percent of one's income to the church. To set an example for the congregation, church leaders often contribute a greater amount to the church. For 1989 the taxpayer reported income from his consulting business of $80,000, and charitable contributions to his church in the amount of $18,151. The IRS audited the taxpayer's ...

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Richard R. Hammar is an attorney, CPA and author specializing in legal and tax issues for churches and clergy.

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Posted:
  • May 1, 1996

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