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determined a $46,628 deficiency in petitioners’ 2001 income tax.
Petitioners filed a petition for review of respondent’s
determination. Petitioners resided in Magnolia, Delaware, when
their petition was filed.
In November 2005, DCS prepared an additional appraisal
document for each property (the 2005 appraisals). Each appraisal
document states that it was prepared “for tax purposes” and to
provide a “retrospective market value” of the subject property as
of February 12, 2001. DCS appraised the development rights to
Procko Farm at $180,000 and the development rights to Webber Farm
at $200,000. Petitioners provided respondent with copies of the
appraisal documents in February 2006, along with a Form 8283
signed by Philip McGinnis, president of DCS.
Discussion
Deductions are a matter of legislative grace and are allowed
only as specifically provided by statute. INDOPCO, Inc. v.
Commissioner, 503 U.S. 79, 84 (1992); New Colonial Ice Co. v.
Helvering, 292 U.S. 435, 440 (1934). In general, section 170(a)
allows as a deduction any charitable contribution made within the
taxable year.5 A taxpayer who sells a property interest for less
5 Sec. 170(f)(3) generally does not permit a deduction for a
charitable gift of property consisting of less than the donor’s
entire interest in the property. Turner v. Commissioner, 126
T.C. 299, 311 (2006). An exception applies in the case of a
“qualified conservation contribution.” Sec. 170(f)(3)(B)(iii);
see also sec. 170(h)(1) (defining qualified conservation
(continued...)
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