You Make the Call - Dec. 5, 2024

Question: Maeve is marking National Pearl Harbor Remembrance Day by donating her family's World War II artifacts to the city of Honolulu, Hawaii, for public display. Will this gift be eligible for a charitable deduction on Maeve's tax return?

Answer: Yes. Property donations to local governments may be tax-deductible. To qualify, the charitable gift must be used for a public purpose. The fact Maeve's artifacts will be on public display likely qualifies as a public purpose, so long as she didn't retain control over the property and received nothing of value from the city in return.

IRC §170(c)(1) states that a donation is tax deductible when it is to a state, a possession of the United States, or any political subdivision of any of the foregoing, or the United States or the District of Columbia, but only if the contribution or gift is made for exclusively public purposes. In this case, the city of Honolulu qualifies as a political subdivision of a state.