The IRS is always accessible when it comes to money, especially when they
will be getting it.
_____
From: Museum discussion list [mailto:[log in to unmask]] On Behalf
Of Lucy Sperlin
Sent: Thursday, January 19, 2006 1:56 AM
To: [log in to unmask]
Subject: Re: Return of monetary gift and the IRS
I’m no expert, but I think they might well at least have to file an amended
tax return for the year of the donation, especially if it was any sizeable
amount. I seriously doubt you could give that kind of money back without
some tax adjustment. Clearly you need to call the IRS on this one. In my
experience they are usually very accessible (start with your phone book),
very nice, and very helpful.
State tax is also a consideration in states that have income taxes, but
charitable donations rules are probably are based on federal returns.
Lucy Sperlin
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From: Museum discussion list [mailto:[log in to unmask]] On Behalf
Of Pamela Silvestri
Sent: Wednesday, January 18, 2006 4:30 PM
To: [log in to unmask]
Subject: Re: Return of monetary gift and the IRS
Good question. I can't see how they would/could be penalized. That was a
valid charitable contribution for that tax year. Your organization has held
that funding since then. This also is an amount of time for which their
money, had it not been donated could have been earning interest or invested
(and taxed).
Unless you provide them with a 1099 or whatever IRS filing form may be
required (if one is), the return of their donation will not be subjected to
tax or penalty because obviously it cannot be considered as income.
I would also consult with your State's Attorney General's office regarding
the refunds.
Pam
In a message dated 1/18/2006 5:50:23 P.M. Eastern Standard Time,
[log in to unmask] writes:
Hopefully some kindly member of the list can point me in the right
direction.
We have a dozen or so individuals who donated money (some a few hundred
dollars, one gift around $2000) for a specific project (it was in the
early planning stage when the money was given), and that project has
just been canceled for a number of reasons (it never went beyond
planning). Since the money was given for a specific purpose we're going
to write to the donors to let them know that the exhibit has been
cancelled and kindly ask that they allow us to put their donation toward
our other exhibits. If they chose not to do so, we'll give their
donation back-but (there's always a but) I am 99.999% certain that if
they took a tax deduction (most likely on their 2004 return) for their
gift, they will take a penalty upon the return of that gift. I did a
quick search of the IRS's website and couldn't find anything relating
directly to this topic. Would anyone be able to provide me with some
specific language on this matter? Has anyone else out there had a
similar situation?
Thanks in advance!
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If you decide to leave Museum-L, please send a one line e-mail message to [log in to unmask] . The body of the message should read "Signoff Museum-L" (without the quotes).
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