Charitable Contributions – Part 1

Church Law and Tax 1989-03-01 Recent Developments Charitable Contributions Richard R. Hammar, J.D., LL.M., CPA

Church Law and Tax 1989-03-01 Recent Developments

Charitable Contributions

Whenever January 1st falls on a Sunday, as it did this year, problems arise regarding the correct receipting of charitable contributions. Specifically, can a member who contributed a personal check to your church on Sunday, January 1, 1989, deduct the check on his or her 1988 federal tax return if the check is dated December 31, 1988? Many churches advised their congregations during worship services conducted on January 1st that their contributions could be credited to 1988 if checks were dated December 31, 1988. Is this true? Unfortunately, the answer is no. Section 1.170A-1(b) of the income tax regulations specifies that “ordinarily, a contribution is made at the time delivery is effected. The unconditional delivery or mailing of a check which subsequently clears in due course will constitute an effective contribution on the date of delivery or mailing.” According to this language, a check dated December 31, 1988 but physically delivered on January 1, 1989, is deductible only on the donor’s 1989 federal tax return. This is so whether a donor “predated” a check to read “December 31, 1988” during church services conducted on January 1, 1989, or in fact completed and dated the check on December 31, 1988 but deposited it on January 1, 1989. The only exception to this rule is in the case of a check that is dated and mailed (and postmarked) in December of 1988. The fact that the church does not receive the check until January of 1989 does not prevent the donor from deducting it on his or her 1988 federal tax return.

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