To receive a charitable tax deduction for the donation of art, a donor must properly substantiate the deduction. This is done with either a qualified appraisal or completion of Form 8283, Noncash Charitable Contributions. One donor donated a sculpture for which he claimed a $600,000 charitable tax deduction. The IRS disallowed the deduction because the donor failed to properly substantiate it. The U.S. Tax Court also disallowed the deduction. The court examined whether the deduction might still be allowed if it could be shown that the failure to meet the substantiation requirements was due to “reasonable cause and not willful neglect.” However, it determined it couldn’t. (TC Memo 2022-102)
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