- 5 -
and a value of $48,000. They also reported a contribution to the
church of stock acquired by purchase on August 1, 1982, with a
basis of $3,057 and a value of $40,000.4 No section B
(Appraisal Summary of $5,000 or More Items) was attached.
Petitioners did not obtain a qualified appraisal, as defined
in section 1.170A-13(c)(3), Income Tax Regs., of the Jackson
Hewitt stock they donated in 1990 and 1991. The fair market
values claimed by petitioners with respect to their gifts of
Jackson Hewitt stock in 1990 and 1991 were based on the average
per-share price of Jackson Hewitt stock traded in bona fide,
arm's-length transactions at approximately the same time as
petitioners made the gifts.
In the notice of deficiency, respondent allowed petitioners
deductions for the gifts of Jackson Hewitt stock in 1990 and 1991
in the amounts of their basis in that stock only.5
Discussion
Section 170(a)(1) provides: "There shall be allowed as a
deduction any charitable contribution * * * payment of which is
made within the taxable year. A charitable contribution shall be
allowable as a deduction only if verified under regulations
4 Petitioners incorrectly allocated the value of the two
blocks of stock on the Form 8283; the correct allocation is
$32,000 for the 800 shares donated to the foundation and $56,000
for the 1,400 shares donated to the church.
5 However, respondent incorrectly computed the basis for
1991; the correct amount is $5,889, instead of $5,189.
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