John T. and Linda L. Hewitt - Page 5

                                        - 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                          
               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.                      

Page:  Previous  1  2  3  4  5  6  7  8  9  10  11  12  13  14  Next

Last modified: May 25, 2011