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Question

I am the managing member of a Missouri LLC. We are considering a gift of the land to a public entity for the construction of a metropolitan community college. What are the income tax benefits of such a gift and how is the value computed? Thank you, XX XXXXXX

Submitted: 520 days and 15 hours ago.
Category: Tax
Value: $30
Status: CLOSED
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Optional Information

Kansas City, Missouri

Posted by LEV 520 days and 14 hours ago.

Info Request

When you transfer the title - who will be a new owner? a metropolitan community college?

520 days and 14 hours ago.

Reply

Yes, land will be donated to the Kansas City Metropolitan community college. We have owned the land to be donated for one year. The donation, passing of deed, can be scheduled to meet any ownership time requirements.

Accepted Answer

Please see for reference the IRS publication 526 - http://www.irs.gov/pub/irs-pdf/p526.pdf

 

the Kansas City Metropolitan community college is a qualified Organizations to Receive Deductible Contributions - see page 3:

A community chest, corporation, trust, fund, or foundation organized or created in or under the laws of the United States, any state, the District of Columbia, or any possession of the United States (including Puerto Rico). It must be organized and operated only for one or more of the following purposes.
-Religious.
-Charitable.
-Educational.
-Scientific.
-Literary.
-The prevention of cruelty to children or animals
.

 

Generally LLC is not taxable entity - all income should be passed through to members and should be reported on individual tax returns regardless it was distributed or not.

If LLC did not elects to be an S corporation - it would use form 1065 - http://www.irs.gov/pub/irs-pdf/f1065.pdf with schedule K-1 - http://www.irs.gov/pub/irs-pdf/f1065sk1.pdf reported income/losses/deductions/credits passed through to members. Deductions for charitable contribution will be reported on the line 13 using following codes:

A - Cash contributions (50%)

B - Cash contributions (30%)
C - Noncash contributions (50%)

D - Noncash contributions (30%)
E - Capital gain property to a 50% organization (30%) - that is likely your case
F - Capital gain property (20%)

 

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Expert: LEV
Pos. Feedback: 99.4 %
Accepts: 7912
Answered: 10/17/2008

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