IRS Announces That Contributions to Certain Single-Member LLCs Now Deductible

IRS Notice 2012-52 has been issued addressing the deductibility of contributions to domestic single-member limited liability companies that are wholly owned and controlled by charitable organizations and are disregarded as entities separate from their owners for federal tax purposes. IRS Notice 2012-52 provides that if all other requirements of contribution deductibility are satisfied, then the Internal Revenue Service will treat a contribution to a disregarded U.S. single-member LLC that is wholly owned and controlled by a domestic charitable organization as a charitable contribution to a branch or division of such charitable organization. IRS Notice 2012-52 further sets forth that the domestic charitable organization would be the donee organization for purposes of the charitable contribution acknowledgement and substantiation rules under §170(f) of the Internal Revenue Code. Finally, the guidance promulgated by IRS Notice 2012-52 is first effective for charitable contributions made after July 30, 2012.