$5.3m Patek Tiffany

[GoingPlaces]

Originally Posted by 77T

It is a two-way write-off if both happen to be US taxpayers because of IRS’ Temporary Suspension of Limits on Certain Charitable Contributions.

In a charity auction as Christie’s structured it, the Patek’s contributor may claim the fair market value as the donation for them is property and not cash (in this case the MSRP). If the property has appreciated in value, however, some adjustments may have to be made.

The winner of the auction may deduct the hammer price (exclusive of Christie’s premium) up to 100% of their AGI for a qualified contribution minus the original fair market value. Complicated but legit. Therefore, there is no duplication of deductible value.

Until recently that was limited to 60% of AGI. Qualified Organizations
You may deduct a charitable contribution made to, or for the use of, any of the following organizations that otherwise are qualified under section 170(c) of the Internal Revenue Code. This is different than 501.c.3.’s:

- A state or United States possession (or political subdivision thereof), or the United States or the District of Columbia, if made exclusively for public purposes;
- A community chest, corporation, trust, fund, or foundation, organized or created in the United States or its possessions, or under the laws of the United States, any state, the District of Columbia or any possession of the United States, and organized and operated exclusively for charitable, religious, educational, scientific, or literary purposes, or for the prevention of cruelty to children or animals;
- A church, synagogue, or other religious organization;
- A war veterans' organization or its post, auxiliary, trust, or foundation organized in the United States or its possessions;
- A nonprofit volunteer fire company;
A civil defense organization created under federal, state, or local law (this includes unreimbursed expenses of civil defense volunteers that are directly connected with and solely attributable to their volunteer services);
- A domestic fraternal society, operating under the lodge system, but only if the contribution is to be used exclusively for charitable purposes;
- A nonprofit cemetery company if the funds are irrevocably dedicated to the perpetual care of the cemetery as a whole and not a particular lot or mausoleum crypt.

So people who have AGI above $5-6 million won’t have a problem. The cost avoidance value after taxes would be around $2.5 million (my SWAG).

But I agree the idea of paying the hammer amount was somewhat excessive.


Sent from my iPhone using Tapatalk Pro

Informative as always.

So PP gets the deduction of 52K plus some adjustments?

Winner gets full deduct minus 52K assuming they meet income (which they do)?

Fees are not included in any deduct.