Chapter 16 - § 16.3 • OTHER ADMINISTRATIVE RULES

• Jurisdiction: Colorado

§ 16.3 • OTHER ADMINISTRATIVE RULES

§ 16.3.1—Timing of Charitable Contributions

For the most part, a charitable contribution is considered made at the time the money or property is delivered to the recipient charity. Treas. Reg. § 1.170A-1(b). If the contribution is made by a check that clears in due course, delivery will be deemed to occur when the check is mailed. Stock certificates similarly will be deemed contributed when they are properly endorsed and physically delivered or mailed to the donee charity or its agent. However, if the taxpayer delivers a stock certificate to the taxpayer's broker, bank, or other agent, with instructions to transfer the certificate into the name of the charity, delivery will not occur until the date the stock is transferred on the books of the corporation. Id.

§ 16.3.2—Substantiating Charitable Contributions

Taxpayers must be able to substantiate their charitable contributions. The level of substantiation required, however, often depends on the size of the donation, the type of asset donated, and the manner in which it was donated.

In the case of contributions in the form of cash, check, or other monetary instrument, the donor must retain either a "bank record" (such as a cancelled check or bank statement) or a written communication from the donee organization showing the name of the donee and the date and amount of the contribution. I.R.C. § 170(f)(17). It is no longer sufficient to substantiate such a contribution through "other reliable written records." Thus, Treas. Reg. § 1.170A-13(a)(1)(iii) may no longer be relied upon in this regard.

In the case of any contribution of property, the taxpayer must retain a receipt from the donee charity showing the name of the donee, the date and location of the contribution, and a description of the property in "reasonably sufficient detail under the circumstances." Treas. Reg. § 1.170A-13(b)(1). If the contribution is made under circumstances where obtaining a receipt would be impractical (for example, by depositing items in an unattended drop site), then a receipt is not required, but the taxpayer must retain written records that meet the requirements for "other reliable written records" previously (but no longer) applicable in the case of cash contributions. See Treas. Reg. § 1.170A-13(b)(2), which also sets forth in some detail the necessary contents of such written records. I.R.C. § 170(f)(8)(D) previously provided that a contemporaneous written acknowledgement would not be required if the donee filed a return with the IRS that contained similar information. Section 13705 of the Tax Cuts and Jobs Act, Pub. L. No. 115-97, repealed I.R.C. § 170(f)(8)(D), effective for contributions made in taxable years beginning after December 31, 2016.

In the case of any contribution of $250 or more, the taxpayer must obtain a written acknowledgement from the recipient charity. I.R.C. § 170(f)(8)(A). The acknowledgement may be provided electronically, such as by means of an email...