§84 — Transfer of appreciated property to political organizations
12 citing cases
Statute Text — 26 U.S.C. §84
If—
any person transfers property to a political organization, and
the fair market value of such property exceeds its adjusted basis,
then for purposes of this chapter the transferor shall be treated as having sold such property to the political organization on the date of the transfer, and the transferor shall be treated as having realized an amount equal to the fair market value of such property on such date.
In the case of a transfer of property to a political organization to which subsection (a) applies, the basis of such property in the hands of the political organization shall be the same as it would be in the hands of the transferor, increased by the amount of gain recognized to the transferor by reason of such transfer.
For purposes of this section, the term “political organization” has the meaning given to such term by section 527(e)(1).
Treasury Regulations
-
Treas. Reg. §1.84-1Transfer of appreciated property to political organizations
(a) Transfer defined. A transfer after May 7, 1974, of property to a political organization (as defined in section 527(e)(1), and including a newsletter fund to the extent provided under section 527(g)) is treated as a sale of the property to the political organization if the fair market value of the property exceeds its adjusted basis. The transferor is treated as having realized an amount equal to the fair market value of the property on the date of the transfer. For purposes of this section, a transfer is any assignment, conveyance, or delivery of property other than a bona fide sale for an adequate and full consideration in money or money's worth, whether the transfer is in trust or otherwise, whether the transfer is direct or indirect and whether the property is real or personal, tangible or intangible. Thus, for example, a sale at less than fair market value (other than an ordinary trade discount), or a receipt of property by a political organization under an agency agreement entitling the organization to sell the property and retain all or a portion of the proceeds of the sale, is a transfer within the meaning, of this section. The term “transfer” also includes an illegal contribution of property.
(b) Amount realized. A transferor to whom this section applies realizes an amount equal to the fair market value of the property on the date of the transfer. For purposes of this section, the definition of fair market value set forth in § 1.170A-1(c) (2) and (3) is incorporated by reference.
(c) Amount recognized. A transferor to whom this section applies is treated as having sold the property to the political organization on the date of the transfer. Therefore, the rules of chapter 1 of subtitle A (relating to income tax) apply to the gain realized under this section as if this gain were an amount realized upon the sale of the property. These rules include those of section 55 and section 56 (relating to minimum tax for tax preference), section 306 (relating to disposition of certain stock), section 1201 (relating to the alternative tax on certain capital gains), section 1245 (relating to gain from dispositions of certain depreciable property), and section 1250 (relating to gain from dispositions of certain depreciable realty).
(d) Holding period. The holding period of property transferred to a political organization to which this section applies begins on the day after the date of acquisition of the property by the political organization.
-
Treas. Reg. §1.84-1(a)Transfer defined.
Transfer defined. A transfer after May 7, 1974, of property to a political organization (as defined in section 527(e)(1), and including a newsletter fund to the extent provided under section 527(g)) is treated as a sale of the property to the political organization if the fair market value of the property exceeds its adjusted basis. The transferor is treated as having realized an amount equal to the fair market value of the property on the date of the transfer. For purposes of this section, a transfer is any assignment, conveyance, or delivery of property other than a bona fide sale for an adequate and full consideration in money or money's worth, whether the transfer is in trust or otherwise, whether the transfer is direct or indirect and whether the property is real or personal, tangible or intangible. Thus, for example, a sale at less than fair market value (other than an ordinary trade discount), or a receipt of property by a political organization under an agency agreement entitling the organization to sell the property and retain all or a portion of the proceeds of the sale, is a transfer within the meaning, of this section. The term “transfer” also includes an illegal contribution of property.
-
Treas. Reg. §1.84-1(b)Amount realized.
Amount realized. A transferor to whom this section applies realizes an amount equal to the fair market value of the property on the date of the transfer. For purposes of this section, the definition of fair market value set forth in § 1.170A-1(c) (2) and (3) is incorporated by reference.
-
Treas. Reg. §1.84-1(c)Amount recognized.
Amount recognized. A transferor to whom this section applies is treated as having sold the property to the political organization on the date of the transfer. Therefore, the rules of chapter 1 of subtitle A (relating to income tax) apply to the gain realized under this section as if this gain were an amount realized upon the sale of the property. These rules include those of section 55 and section 56 (relating to minimum tax for tax preference), section 306 (relating to disposition of certain stock), section 1201 (relating to the alternative tax on certain capital gains), section 1245 (relating to gain from dispositions of certain depreciable property), and section 1250 (relating to gain from dispositions of certain depreciable realty).
-
Treas. Reg. §1.84-1(d)Holding period.
Holding period. The holding period of property transferred to a political organization to which this section applies begins on the day after the date of acquisition of the property by the political organization.
12 Citing Cases
o a traditional mortgage (i.e., giving the lender an interest in the property and requiring payment before the buyer has an unencumbered interest) but is sometimes used for higher-risk borrowers, see 15 Powell on Real Property, - 44 - [*44] supra, sec. 84D.0l[2], in which case we would expect to see terms less favorable for the borrower than a traditional mortgage. That is, for an arm's- length contract for deed, we would expect to see a higher interest rate (rather than the 6.0% rate stated in
948 (1985), "[b]y assuming numerous relatively small, independent risks that occur randomly over time, the insurer smoothes out losses to match more closely its receipt ofpremiums." 1. The Parties' Arguments The Avrahamis and Feedback claim their arrangement distributed risk in two independently sufficient ways. First, they rely on Securi
764 (1985). Third, the IRS is not required to accept and process petitioner's second amended return on which he deleted the imputed income item and claimed a larger overpayment. See Badaracco v. Commissioner, 464 U.S. 386, 393 (1984) ("[A]n amended return is a creature ofadministrative origin and grace."); Goldring v. Commissioner, 20 T.C
948 (1985), "[b]y assuming numerous relatively small, independent risks that occur randomly over time, the insurer smoothes out losses to match more closely its receipt ofpremiums." 1. The Parties' Arguments The Avrahamis and Feedback claim their arrangement distributed risk in two independently sufficient ways. First, they rely on Securi
1308 (1985); Alford v. Commissioner, 800 F.2d 987, 988 (10th Cir. 1986), § 84 T.C. 1308 (1985); Benzvi v. Commissioner, 787 F.2d 1541, 1542 (1 lth Cir. 1986); Commissioner v. Stewart, 186 F.2d 239, 242 (6th Cir. 1951) (finding a deficiencynotice valid where it fairly advised the taxpayer ofthe amount and year ofthe deficiency and the taxp
948 (1985). Many insureds who pay premiums will not incur losses. Insuring many independent risks in return for numerous premiums thus serves to distribute risk, in effect spreading a portion ofthe insurer's potential liability among his insureds. S_e_e Black Hills Corp., 101 T.C. at 183; Harper Group, 96 T.C. at 59; AMERCO, 96 T.C. at 40
50 (LexisNexis 2010), Oregon, Or. Rev. Stat. sec. 65.067 (2009), Washington, Wash. Rev. Code. Ann. sec. 24.12.010 to .060 (West 2005), and Wyoming, Wyo. Stat. sec. 17-8-101 to -117 (2009). In addition, Arkansas and Florida have recognized the common law corporation sole. See, e.g., City of Little Rock v. Linn, 432 S.W.2d 455 (Ark.