Kingman K. Babcock and Lillian L. Babcock - Page 10

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          mentioned, petitioners are entitled to deduct unreimbursed                  
          expenditures made incident to the rendition of services to an               
          organization contributions to which are deductible.  Sec. 1.170A-           
          1(g), Income Tax Regs.  In other words, although Congress granted           
          most foster parents relief from tax recordkeeping in section 131            
          (as detailed in Cato v. Commissioner, 99 T.C. 633, 641-643                  
          (1992)), if foster parents keep records which show they expended            
          more than they were reimbursed, they are entitled to deduct the             
          excess under section 1.170A-1(g).  (We note that the New York               
          State Department of Social Services and Monroe County require               
          foster parents to keep extensive records concerning their foster            
          children:  "Foster parents are to keep specific financial,                  
          school, health, visitation and child adjustment records/logs".)             
          Thus, in this case we must decide which expenses have been                  
          reimbursed by the $9,539 petitioners received from Monroe County            
          to determine the unreimbursed expenses, if any.                             
               The Monroe County Department of Social Services, the agency            
          responsible for petitioners' foster child, is an organization,              
          contributions to which are deductible.  For 1991, petitioners               
          received from Monroe County a board payment of $8,559, a clothing           
          allowance of $509, and special allowances of $471, for a total              
          reimbursement of $9,539.                                                    
               Concerning the board payment, the Monroe County Department             
          of Social Services Foster Parent Manual explains that the                   






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