135 Miscellaneous Recommendations
MISCELLANEOUS RECOMMENDATIONS
Legislative Recommendation #58
Modify the Requirement That Written Receipts Acknowledging
Charitable Contributions Must Pre-Date the Filing of a Tax Return
SUMMARY
• Problem: To claim a charitable contribution, a taxpayer must obtain a contemporaneous written
acknowledgment (CWA) that states the amount of cash and a description of any property contributed,
whether any goods or services were received in exchange, and a description and estimate of the value of
any such goods or services. e CWA must be received prior to the date of ling the return or the due
date of the return, whichever is earlier. is is a strict requirement with no exceptions. If taxpayers do
not obtain a CWA prior to the ling date or due date, they are not eligible for the deduction, even if
they made the contribution and can otherwise substantiate it.
• Solution: Eliminate the “contemporaneous written acknowledgment” requirement and replace it with an
“adequate written documentation” requirement.
PRESENT LAW
IRC § 170(a) authorizes deductions for charitable contributions made in a taxable year. IRC § 170(f)(8)
disallows charitable contribution deductions over $250 unless the taxpayer substantiates the contributions
with a CWA of the contribution from the donee organization. e CWA must be received before the earlier
of the date on which the tax return is led or the date on which the tax return is due.
1
e acknowledgment
must include the following:
(i) e amount of cash and a description (but not value) of any property other than cash contributed.
(ii) Whether the donee organization provided any goods or services in consideration, in whole or in
part, for any property described in clause (i).
(iii) A description and good-faith estimate of the value of any goods or services referred to in clause (ii)
or, if such goods or services consist solely of intangible religious benets, a statement to that eect.
e CWA does not need to take any particular form, but the requirement for the content and timing is strict.
2
For purposes of the CWA, substantially complying with the rules is not enough. e law is rigid and does not
permit the IRS or judges to exercise discretion.
3
REASONS FOR CHANGE
e strict CWA requirement of IRC § 170(f )(8) harms taxpayers and tax-exempt organizations that are trying
to do the right thing but may not be aware of the exact legal requirements.
Example: Assume a taxpayer contributes $1,000 to a school’s Parent Teacher Association (PTA). She
receives a receipt at the time of donation showing the amount given. At the time she les her return, she
has not received a letter from the PTA acknowledging the $1,000 donation and stating that no goods
or services were provided in consideration for the $1,000 donation. She les her tax return claiming
2 See Albrecht v. Commissioner
15 W. 17th St. LLC v. Commissioner,