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RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8784
Experience:  CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
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I am selling my commercial building to the VFW. Can I take

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I am selling my commercial building to the VFW. Can I take a charitable deduction as part of the selling price. The facts are as follows: 825,000. is the selling price with 80,000 down payment, I will hold a note for 420,000 over 10 years and I will take a 325,000. charitable donation either over 10 years or earlier if I choose. Thank you
Please confirm if you are going to report the gain on sale of the building based on the $825,000 selling price?
Customer: replied 7 years ago.
I assume I would have to report 825,000. if I am to take a charitable donation. thank you
Yes, if you report $825K sale than you can take a charitable deduction for the amount that you are not going to collect from the buyer.
Since the payment of the donation is in the current year, this will be considered as charitable deduction for the current year. The maximum amount you can deduct in the year is upto 50% of the AGI and balance deduction will be carried forward in future and allowed in future years.

Let me know if you have any question.

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

Customer: replied 7 years ago.
VFW said that I can take the deduction in one year or over 10 years since I am holding the note for 10 years. Is this true or must I take the deduction in the year of sale? thank you for your quick response. Also I can I ask for you directly in the future?
It would depend on how you structure the entire sale. Generally if you hold a note for the entire balance due and than give back part of the note balance every year as charitable contribution and receive yearly payment on the balance note than you can spread the contribution over a number of years too.

You can request RD on the post to ask for me.

Let me know if you have any question.

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

RD and other Tax Specialists are ready to help you
Customer: replied 7 years ago.
Thank you for your quick response. You have always been extremely helpful.