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October 31, 2013

Q&A: Is Donated Parking Space Tax Deductible?

Tax law suggests one church may need to rethink its approach.

parking.jpg

Q: A church member allows us to park our buses at his business. We used to pay $200 a month for this service. In the past we have given this church member a letter indicating a donation of $2,400 per year, which he could use as a charitable contribution. Our question is, "What is the proper method to handle this?"

A: The contribution of services is not tax deductible. You may give him a letter thanking him for his contribution.

For more help with charitable contributions, check out chapter 8 of Richard Hammar's 2013 Church & Clergy Tax Guide.

Frank Sommerville is a shareholder in the law firm of Weycer, Kaplan, Pulaski & Zuber, P.C. in Houston and Dallas, Texas. He received his bachelor's degree in business from Texas Wesleyan University. He received his masters in professional accounting with an emphasis on taxation from the University of Texas at Arlington. His law degree is from the University of Houston Law Center. He holds a license as a Certified Public Accountant. He is also Board Certified in Tax Law by the Texas Board of Legal Specialization. He is rated AV (highest possible) by Martindale-Hubbell Legal Directory.

Frank is an Editorial Advisor for Christianity Today's Church Law & Tax Group.

Related Tags: charitable contributions, donations, donors, giving, receipts, treasurers

Comments

Hello Frank,
I am glad to see this post reiterating tax law that has been around for years. Every once and a while this issue comes up whenever there is a donation of measurable value. It's funny about churches though, as if they don't get enough tax breaks, haha.

-Harvard Barnett

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