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08-20-2012 Deductions for Contributions to U.S. Single-Member LLCs Owned and Controlled by U.S. Charities

Under Notice 2012-52, a contribution made to a single-member limited liability company that is wholly owned and controlled by a qualified charitable organization is deductible for federal tax purposes for all contributions made on or after July 31, 2012.

If all other requirements of I.R.C. § 170 are met, then the IRS will allow a taxpayer to deduct such a contribution even though the contribution is not going directly to a qualified charity. Effective July 31, 2012, the IRS will treat a contribution to a domestic disregarded single-member limited liability company that is wholly owned and controlled by a U.S. charity as if it were a charitable contribution made directly to a branch or division of that U.S. charity. For all intents and purposes, it is as though the donation were made directly to the U.S. charity. Any substantiations and disclosures should reflect the U.S. charity as the recipient.

Fraser Stryker has extensive experience in addressing complex issues related to Nonprofit and Charitable Organizations and Taxation. For more information regarding the requirements for charitable contributions or the deductibility of certain contributions, please contact Nicole R. Konen.


This article is provided by Fraser Stryker for general informational purposes and is not intended to be and should not be construed as legal advice on any specific facts or circumstances.