The U.S. Tax Court said “no” to several taxpayers who tried to claim charitable contribution deductions related to a sale of property owned by their family’s S corporation. After a “bargain” sale of the property for $5.25 million to a government entity, they claimed $5.22 million in charitable contribution deductions on their individual tax returns. The IRS argued the taxpayers failed to show the value of all consideration received as part of the sale and failed to establish the value of the underlying charitable contribution. The court agreed. In addition to denying the deductions, the court found the family members were liable for accuracy-related penalties. (TC Memo 2023-85)
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