Other Developments

• Date: 01 January 2020
• Published date: 01 January 2020
• DOI: http://doi.org/10.1002/npc.30680

Bruce R. Hopkins’ NONPROFIT COUNSEL

8 January 2020 THE LAW OF TAX-EXEMP T ORGANIZATIONS MONTHLY

Bruce R. Hopkins’ Nonpr ofit Counsel DOI:10.10 02/n pc

Contrary views came from the End Citizens United

Action Fund, by letter dated November 4. From this per-

spective, “[t]ransparency is critical to a democracy that’s

open and accountable to the people.” The fund wrote

that “[n]o longer requiring politically-active nonprofit

organizations to disclose their major donors to the IRS

will undermine this core tenet of our political system and

make it easier for unscrupulous organizations to accept

and spend dark money and illegal foreign contributions

on our elections without oversight or consequence.”

[28.11(i)] ◆

IRS UPDATES INFLATION

ADJUSTMENTS FOR 2020

The IRS published annual inflation adjustments for tax

provisions for 2020 (Rev. Proc. 2019-44). Here are the

pertinent items:

• An exception from unrelated business income taxa-

tion involving low-cost articles is applicable with

respect to articles with a cost of no more than

$11.20. [25.2(j)]

• The $5, $25, and $50 guidelines for disregarding

the value of insubstantial benefits received from a

donor in return for a fully deductible income tax

charitable contribution are $11.20, $56, and $112.

[Appendices D–F]

• The annual per-person, -family, or -entity dues limita-

tion to qualify for the reporting exception regarding

certain exempt organizations with nondeductible

lobbying expenditures is $119. [22.6(a)]

• The limitation regarding the exemption of annual

dues required to be paid by a member to an exempt

agricultural or horticultural organization is $171.

[25.2(l)]

This revenue procedure also includes the tax-rate

tables, the standard deduction amount (e.g., $24,800

for married individuals filing jointly), and the gift tax

exclusion ($15,000). ◆

OTHER DEVELOPMENTS

◆The US Court of Appeals for the Tenth Circuit, by

decision dated October 25, held that (1) a claimed

charitable deduction for a gift of land improvements to

a family ministry was not allowable because the donors

did not own the property involved; (2) claimed charitable

deductions were not allowable because the substantia-

tion requirements were not met, in that services were

provided and not disclosed; (3) a claimed charitable

deduction for a gift of a tractor mower was not allow-

able because the donors did not establish reasonable

cause for failure to comply with substantiation and

appraisal requirements; (4) a deduction for a gift of the

donor’s personal residence was not allowable because

the donors did not comply with the requisite appraisal

requirements; and (5) the donors involved are liable for

the 20-percent accuracy-related penalty (IRC § 6662(a))

(Presley v. Commissioner). This decision affirmed US Tax

Court findings (opinion referenced in the December

2018 issue). [3.1(c), 3.2, 10.14(a), 21]

◆The US Court of Appeals for the Ninth Circuit, on

November 12, denied the petition for a rehearing en banc

in a case concerning government agencies’ promulgation

of regulations and courts’ review of them (Altera Corpo-

ration & Subsidiaries v. Commissioner). Reversing the US

Tax Court, a Ninth Circuit majority upheld the validity of a

Treasury regulation. Three judges dissented in connection

with the petition denial, finding the regulation at issue

the “epitome of arbitrary and capricious.” A discus-

sion of this case, from the tax-exempt organizations

law perspective, is in the October and November 2018

issues. ◆

Quote of the Month: The letter accompanying the new

National Philanthropic Trust report on donor-advised

funds (see the first article in this issue) states that, for the

ninth consecutive year, “there was growth in all key met-

rics [concerning DAFs] — number of individual donor-

advised funds, total grant dollars from donor-advised

funds to charitable organizations, total contributions to

donor-advised funds and total charitable assets in them.”

Each article in the newsletter on a tax-exempt organizations law topic ends with a citation to the appropriate chapter(s) or

subchapter(s) in Hopkins, The Law of Tax-Exempt Organizations, Twelfth Edition (Wiley, 2019). This is done to provide ready access

to additional and background information concerning these articles. For example, underlying information concerning the first article

in this issue is available in Chapter 11 § 8 of the book; thus, the citation is referenced as [11.8]. Likewise, each article in the news-

letter on a charitable giving law topic ends with a citation to the appropriate chapter(s) or subchapter(s) in Hopkins, The Tax Law of

Charitable Giving, Fifth Edition (Wiley, 2019 cumulative supplement). For example, underlying information concerning the second

article in this issue is available in Chapter 9 § 31 of the book; thus, the citation is referenced as [9.31].

This newsletter is a stand-alone publication. An inventory of articles in the newsletter since its inception in 1983, and a subject mat-

ter index, as well as an index of the court opinions, IRS revenue rulings and procedures, IRS technical advice memoranda, and IRS

private letter rulings discussed in the newsletter, are available at www.brucerhopkinslaw.com. For those who have the books, the

newsletter also provides monthly updates. Both books are annually supplemented. Questions concerning nonprofit law develop-

ments in general may be sent to brucerhopkins@brucerhopkinslaw.com. Also, a comprehensive summary of nonprofit law is avail-

able in the Bruce R. Hopkins Nonprofit Law Library, an e-book published by Wiley. Follow BRHopkins_NPLaw on Twitter.

The newsletter has a dedicated website. Please visit wileyonlinelibrary.com/journal/npc.