In a message dated 1/18/2006 7:31:09 P.M. Eastern Standard Time,  
[log in to unmask] writes:

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).


I dunno.  I've always operated on the assumption that the IRS looks  dimly on 
the return of gifts for which deductions have been taken--although I  can't 
cite any legal language to support my view.  It would be awfully easy  for an 
unscrupulous institution to conspire with a donor to commit fraud if such  
returns were allowed without penalty (by penalty I mean having to pay taxes on  
the returned amount).  Perhaps there's no problem if the donor simply  declares 
the return as income and pays taxes on it.  In previous  discussions on this 
list about deaccessioning artifacts, I think the consensus  has been that the 
donor is the last entity to whom you would want to send a  deaccessioned 
object, precisely because of the tax consequences.
 
David Haberstich

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