Michael Ferguson and Valene Ferguson - Page 15

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          approving the merger agreement and that the gifts occurred                  
          subsequent thereto.                                                         
               Resolution of the competing positions advanced by the                  
          parties requires an analysis of the circumstances surrounding the           
          merger agreement, the tender offer, and the gifts to the                    
          Charities.  Based on the facts of this case, we believe that the            
          stock of AHC was converted from an interest in a viable                     
          corporation to the right to receive cash prior to the date of the           
          gifts to the Charities, and, therefore, petitioners are taxable             
          on the gain in the donated stock.                                           

          II.  Analysis                                                               
               A.  Date of the Gifts                                                  
               Section 170(a) allows a deduction for any charitable                   
          contribution payment of which is made within the taxable year.              
          The term “charitable contribution” is defined in section 170(c)             
          as a contribution or gift to or for the use of various enumerated           
          entities and, therefore, is synonymous with the term “gift”.  See           
          DeJong v. Commissioner, 36 T.C. 896, 899 (1961), affd. 309 F.2d             
          373 (9th Cir. 1962).  Thus, the donation of AHC stock to the                
          Charities must satisfy the requirements of a valid inter vivos              
          gift in order to qualify as a charitable contribution under                 
          section 170(a).  See, e.g., Guest v. Commissioner, 77 T.C. 9, 15-           
          16 (1981).  The existence of the gifts to the Charities, however,           

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