August 22, 2013

Church as a Conduit for Non-deductible Gifts: Illustration

Question:

A member of a church has recognized the need of a family in the congregation for a new vehicle. If the member purchases a car and gives it to the church, which immediately passes it along to the needy family, can the donor claim a tax deduction?

Answer:

Car purchases and gifts of this type are common topics on the MinistryCPA blog, so readers should first consider the following blog posts.

Donating a Vehicle

Church as a Conduit for Non-deductible Gifts

Deductibility of Designated Gifts

Since it is apparent that the car is a gift from one individual to another individual, using the church as a conduit, it is highly unlikely that a charitable deduction is warranted. As readers may have observed by reading the above blog posts, congregational initiation is necessary to avoid the appearance or reality of a gift between individuals. In order for a gift to be deductible, it must be a charitable act of the church body rather than the good intentions of an individual.

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