R. Edwin Brown and Winsome S. Brown - Page 14

                                       - 14 -                                         
          Issue 2. Charitable Contribution Deduction                                  
               Respondent argues that petitioners are not entitled to a               
          charitable contribution deduction because the amount of the                 
          encumbrance exceeded the fair market value of the property at the           
          time of the transfer.  Petitioners argue that they should be                
          allowed a charitable contribution deduction for the projected               
          income stream associated with the lease.                                    
               A taxpayer may make a charitable contribution by selling or            
          disposing of property to a charity for less than its fair market            
          value.  Estate of Bullard v. Commissioner, 87 T.C. 261, 265                 
          (1986).  The amount of the charitable contribution resulting from           
          such a “bargain sale” generally is the excess of the fair market            
          value of the property over its sale price.  Id.; Stark v.                   
          Commissioner, 86 T.C. 243, 255-256 (1986); Knott v. Commissioner,           
          67 T.C. 681 (1977); Waller v. Commissioner, 39 T.C. 665, 677                
          (1963).  Furthermore, to the extent that the fair market value of           
          property contributed exceeds the debt on the property, taxpayers            
          are entitled to a charitable contribution deduction.  Guest v.              
          Commissioner, supra at 25.                                                  
               A taxpayer has the burden of proving the amount of a                   
          charitable contribution that he or she may deduct.  Rule 142(a);            
          Guest v. Commissioner, supra; Lamphere v. Commissioner, 70 T.C.             
          391 (1978).  Section 1.170A-1(c)(1), Income Tax Regs., provides             
          that the amount of a charitable contribution of property other              
          than money is the fair market value of the property at the time             




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