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C. Petitioners’ Tax Returns and the Notice of Deficiency
Petitioners claimed deductions for charitable contributions
to NHF of $36,285 in 1997 and $36,000 in 1998. Respondent
determined in the notice of deficiency that petitioners are not
entitled to those deductions.
OPINION
Respondent contends that (1) petitioners may not deduct any
of their payments to NHF because petitioners received a benefit
from NHF, and that (2) petitioners may not deduct any of their
payments to NHF because petitioners did not comply with the
substantiation requirement of section 170(f)(8) and section
1.170A-13(f)(6), Income Tax Regs. Respondent contends that the
contemporaneous written acknowledgment by NHF of petitioners’
payments (1) incorrectly states that NHF provided no goods or
services in exchange for petitioners’ payments, and (2) contains
no description or good faith estimate of the value of the
benefits petitioners received. To prevail on the charitable
contributions issue, petitioners must overcome both of
respondent’s arguments. We will first consider respondent’s
second argument.
A. Substantiation Requirement Under Section 170(f)(8)
A taxpayer may not deduct any contribution of $250 or more
unless he or she substantiates the contribution with a
contemporaneous written acknowledgment of the contribution by the
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