Maria Elena Towell, Petitioner

CLC T . C . Summary Opinion 2010 -141 UNITED STATES TAX COURT MARIA ELENA TOWELL, Petitioner v. COMMISSIONER OF INTERNAL REVENUE, Respondent Docket No. 8002-09S Filed September 21, 2010.

Maria Elena Towell, pro se.

Mark J. Tober, for respondent.

WELLS, Judge:

This case was heard pursuant to the provisions-of section '7463 of the Internal Revenue Code in effect when the petition was filed.¹ - Pursuant to section 7463 (b) , the All section references are to the Internal Revenue Code in effect for the year'in issue, and all Rule references (Code) are to the Tax Court Rules of Practice and Procedure, unless otherwise indicated. All amounts are rounded to the nearest dollar.

SERVEDSep212010 decision to be entered is not reviewable by any other court, and this opinion shall not be treated as precedent for any other case.

Respondent determined a deficiency in petitioner's 2006 Federal income tax of $1,995.. The issues that remain for decision are:

(1) Whether petitioner is entitled to a deduction pursuant to section 170(a) (1) for a claimed $423 cash charitable contribution; and (2) whether petitioner is entitled to a deduction pursuant to section 170(a) (1) for a claimed $12,900 noncash charitable contribution. ' s Background Some of the facts and certain exhibits have been stipulated.

The stipulations of fact are incorporated in this opinion by reference and are found accordingly.

At the time the petition was filed, petitioner resided in Florida.

Petitioner purchased a timeshare interest (timeshare) for $12,396 from Westgate Miami Beach, Ltd.

(Westgate), on May 20, 2001.2 Petitioner executed a mortgage agreement with Westgate for the purchase of her timeshare.

On October 12, 2004, 2A timeshare interest represents an individual's interest in a jointly owned or rented property (such as a vacation condominium) which is shared by several persons who take turns occupying the'property. Black's Law Dictionary 1492 (7th ed. 1999).

yetitioner made full payments and satisfaction of the mortgage r 3 ith Westgate During 2006, petitioner donated her timeshare to Tracets Foundation (Tracets) . Tracets, which claims to be a section 501(c) (3) foundation,3 is dedicated to preserving- lakes and streams for future generations.

:Tracets "partnered" with, holesale Timeshare "Services and eMidsouth, Inc., to coordinate he transfer of the timeshare from petitioner.; On November 30, 2006, petitioner signed a general warranty deed transferring ownership of her timeshare to eMidsouth, Inc.

Petitioner did not , have ans appraisal «of the value of the imeshare made when it was transferred. Petitioner attached Form 283, Noncash Charitable,Cóntributions, to her return for tax year 2006.

. On Form .8283, in the section for donated property of 5,000 or less, petitioner listed the donation of her timeshare Respondent does not challenge whether Tracets meets the efinition of an organization to which a contribution is eligible or a charitable deduction.

Sec. 170(c). Accordingly, we deem that issue conceded.

. Because -of respondent's concession, an estimate of the See Cohan v. Commissioner, 39 The Court has not definitively . See Kendrix v. Commissioner, T.C. Memo. 2006-9 allowable deduction could.be made. F.:2d 540, 543-544 (2d Cir. 1930). decided whetÑer Cohan is- available to estimate charitable contributions. (finding that the Court has not yet squarely addressed the inherent conflict.between sec. 170(a) (1) and the application of Cohan to unverified or inadequately substantiated charitable contributions).. However, because petitioner presented no evidence on the value of which to estimate an allowable amount.

there is no basis on the timeshare, to Tracets, stated that it.had a fair market value of $12,900, and stated that an appraisal was used to determine the fair market value.

Discussion Deductions are a matter of legislative grace, and taxpayers bear the burden of proving that they are entitled to the deductions claimed.

.See Rule 142(a);

INDOPCO,

Inc. v.

Commissioner, 503 U.S. 79, 84 (1992); New Colonial Ice Co. v.

Helvering, 292 U.S. 435, 440. (1934).4 Section 170(a) (1) provides:

"There shall be allowed as a deduction any charitable contribution * * * payment of which is made within the taxable year..

A charitable contribution shall be allowable as a deduction only if verified under regulations prescribed by the Secretary.", Generally, contributions of money (cash, check, or other monetary gift), can be substantiated by either a canceled check, a receipt, or other reliable written records." Sec. 1.170A-13 (a) (1), Income Tax Regs. Additionally, 4Petitioner has not raised any issue regarding sec. 7491(a); and because she has failed to substantiate her claims or introduce credible evidence for any of does not apply.

See sec. 7491(a) (1) and (2) (A).

the issues, sec. 7491(a) sFor contributions of money in any amount made during tax taxpayers are required to years beginning after Aug. 17, 2006, maintain a bank record or a written communication from the donee showing the name of the donee organization, contribution, and the amount of 170(f) (17). recordkeeping requirement.

There is no de minimis exception, to the Sec. 170(f) (17); see also sec.

the date of Sec.

the contribution.

the (continued...)

for contributions of $250 or more, deductions are not allowed nless the taxpayer substantiates the côntribution by a bontemporaneous written acknowledgment by the donee organization.

Sec . 170 (f ) (8) (A) .

The written acknowledgment must include:

(i) the amount of cash and a description (but not value) of any property other than cash contributed.

(ii) whether the, donee organization provided any goods for any in whole or in part, or services in cònsideration", property described in clause (i) .

(iii) a description and good faith estimate of value of any goods or services referred to in clause (ii) or, religious benefits, a statement if such.goods or services consist solely of to thati effect.

intangible the Sec . 170 (f) (8) (B) .

To be considered contemporaneous, the written acknowledgment must be obtained by the taxpayer before the earlier of the due date of the return, 'including extensions, or the filing of the return.

Sec. 170 (f) (8) (C) .

Petitioner failed to give testimony or offer documentary evidence regarding her cash contribution. Accordingly, Še s ( .

.

. continued) 1.170A-15(a), Proposed Income Tax Regs., 45914 (Aug. 7, 2008) . However, because petitioner's tax year began on Jan. 1, 2006.

-73 Fed. Reg. 45908, this section does not apply 'Separate contributions of the requirements of sec. 170(f) (8), of during a taxable year equals $250 or more. 13 ( f ) (1) , Income Tax Regs .

the contributions made 'by a taxpayer . to a donee organization See sec. 1.170A- less than $250 are not subjeet to regardless of whether the sum sustain respondent's denial of petitioner's claimed deduction for a cash charitable contribution of $423.

Charitable contributions greater than $500 are subject to heightened substantiation requirements.

Sec. 170(f) (11) (A) (i).

For noncash contributions greater than $5,000, a deduction is allowed if a taxpayer:

"obtains a qualified appraisal of such property and.attaches to the return for the taxable year in which such contribution is made such information regarding such property and such appraisal as the Secretary may require."

Sec. 170(f) (11) (C). Section 170(f) (11) was added to the Code pursuant to the American Jobs Creation Act of 2004, Pub. L. 108- 357, sec. 883, 118 Stat. 1631, to codify the substantiation requirements previously addressed in the regulations and applies to contributions made after June 3, 2004. Smith v. Commissioner, T.C. Memo. 2007-368, affd. 364 Fed. Appx. 317 (9th Cir. 2009). A qualified appraisal is conducted by a qualified appraiser in accordance with generally acceptable appraisal standards and is treated as a qualified appraisal under the regulations and other guidance provided by the Secretary.' Seå. 170(f) (11) (E).

7Sec. 170(f) (11) (E) was amended by the Pension Protection Act of 2006, Pub. L. 109-280, sec. 1219(c) (1), 120 Stat. 1085. As amended, sec. 170(f) (11) (E) codifies the definition of qualified appraisals and appraisers and is effective generally to returns or submissions for appraisals prepared with respect As petitioner's filed after Aug. 17, 2006. return was filed after Aug. 17, 2006, 170(f) (11) (E) applies.

Id. sec.'1219(e).

the amended sec.

However, a deduction will not be denied if the failure to meet.

the requirements of section 170 (f) (11) (A) (i)' is due to reasonable cause and not willful neglect.

Sec. 170 (f) (11) (A) (ii) (II) .

Petitioner failed to provide evidence of any appraisal of her timeshare. Petitioner stestified that she never received an åppraisal from Westgate upon 'the purchase of her timeshare in 001. Regulations issued before the addition of section 170.(f) (11) required the qualified appraisal to be made not earlier than 60 days before the date of contribution and before the due date of the original return, plus extensions, on which the contribution is first claimed, or in the case of an amended keturn, the filing date.

Sec . 1.170A-13 (c) (3) (i) (A) , Income Tax Regs.

On October 19, 2006, the Internal Revenue Service issued transitional guidance to provide a safe harbor for taxpayers in ponjunction with new section 170 (f) (11) (E) . Notice 2006-96, 2006 2 C.B. 902.

The transitional guidance provides that the requirements of section 1.170A-13(c), Income Tax Regs., that are consistent with section 170 (f) (11) still apply, including the time limits.

Id. Regardless of whether she received an appraisal from Westgate in 2001, petitioner never obtained a qualified appraisal of her timeshare in conjunction with her 2006 contribution to Tracets .

See sec . 170 (f) (11) (C) . Moreover, petitioner did not offer any reason for her failure to obtain a qualified appraisal; therefore, petitioner has not proved that her failure to meet the requirements of section 170(f) (11) was due to reasonable cause and not willful neglect.

, Accordingly, we sustain respondent's denial of petitioner's claimed deduction for a noncash charitable contribution of $12,900.

We have considered all of the contentions and arguments of the parties that are not discussed herein, and we conclude they are without merit, irrelevant, or moot.

To reflect the foregoing,.

Decision will be entered for respondent.