Filing of Form 8283, Noncash Charitable Contributions, is the responsibility of the donors (examples – individuals, partnerships and S-Corps). Tax-exempt and non-profit organization (donee organization) need to pay attention to this form and how the donated property was listed either as Section A or Section B property.
Per the IRS, Section A property includes only the following items:

• Items, or groups of similar items, for which the donor claimed a deduction of $5,000 or less per item or group.
• Publicly traded securities even if the deduction is more than $5,000.  Publicly traded securities are securities listed on an exchange in which quotations are published daily (New York Stock Exchange NYSE), regularly traded in national or regional over-the-counter markets for which published quotations are available, or shares of a mutual fund for which quotations are published on a daily basis in a newspaper of general circulation throughout the United States.

Section B property (charitable deduction property) includes items, or groups of similar items, for which the donor claimed a tax deduction of more than $5,000. Publicly traded securities listed in Section A are not include in Section B. I do want to make a note that there are special rules for certain C corporations for contributions of inventory or scientific equipment.

Section B items require a written appraisal by a qualified appraiser to be attached for filing.  Certain exceptions apply to this rule. The Form 8283 is required to be signed by the donor, the qualified appraiser, and the donee organization (i.e. the non-profit organization receiving the items). The donor should attach this form with their personal/partnership tax return.

Form 8282:  Now for the tax-exempt organizations responsibilities…
The not-for-profit organization (NPO) who received the charitable deduction property (donated property) is required to file the Form 8282 if the charitable deduction property was sold or disposed of within 3 years of receiving the property. The Form 8282 is filed with the IRS and a copy is given to the donor.

Now, for those who paid attention to the categories of the property, the Form 8282 is only required to be filed for the property listed in Section B of the Form 8283 (see above). If the NPO received donated items that are not considered Section B items, then the Form 8282 is not required to be filed.

If the NPO did not receive the Form 8283, but has reason to believe they should have received it, then the organization is still required to file the Form 8282.

Exceptions of when Form 8282 does not have to be filed when:

• Section B items had an original appraisal value of $500 or less
• Section B items were used to fulfill the purpose of the tax-exempt organization (i.e. medical supplies used by a tax-exempt relief organization in aiding disaster victims).

If you have further questions, please give me a call.

The purpose of the form is to apply for tax exemption under Section 501(c)(3) of the Internal Revenue Code. This application is due within 27 months from the end of the month in which the organization is formed. This form can be cumbersome as the IRS requires specific financial data, organizing documents, and narrative description and details of the organization. The estimated average times to complete the form, including recordkeeping, learning about the law and preparing the form, per the IRS, is over 150 hours. Therefore, I recommend having a tax professional with experience in this area assist in preparation of the form.

Certain organizations are considered tax exempt under Section 501(c)(3) without having to file the Form 1023. These organizations include:

• Churches 
•  Integrated auxiliaries of churches and conventions or associations of churches 
• Any organization that normally has less than $5,000 in gross receipts in each taxable year

The Form 1023 is a public document along with the Form 990 and 990-T. The organization should make this form available for public inspection and is required to provide, upon request, copies without charge.

If you need more information about the Form 1023 and the application process, please contact me.

11/14/08 Posted by Jamie Graham