Ezel / IRS Rulings / 200943034

CCA 200943034: Rehabilitation credits reduce a façade easement deduction

Number
200943034
Outcome
Advice
Document type
Chief Counsel Advice
IRS subject
Qualified Real Property Interest
Topics
Income and deductions
Code sections
§ 47, § 170
Ruling dated
August 25, 2009
Publicly released
October 23, 2009
Source
View Official PDF

Apply this to your situation

This page covers legal advice the IRS Office of Chief Counsel wrote for IRS staff, issued in 2009, which can't be cited as precedent. Ask about your situation and see what the current Code and IRS guidance say, with citations.

Currency note: this determination was released in 2009
Statutory amendments, regulation changes, court decisions, or later IRS guidance may have changed the analysis since then. Treat this page as historical context, not current tax advice. Verify current law before relying on any specific rule, threshold, or position mentioned here.
Not precedent. Under 26 U.S.C. § 6110(k)(3), this written determination may not be used or cited as precedent. It is advice from the IRS Office of Chief Counsel to IRS personnel on the facts they presented, and identifying details were redacted by the IRS before release. The official IRS release (linked on this page as a PDF) is the authoritative source.
About this page: The plain-English summary and ruling snapshot below were written by Ezel based on the official IRS release. The full text is the IRS's own document.
View official IRS release (PDF)

Plain-English summary

This Chief Counsel Advice addresses the charitable contribution deduction for a façade easement when a rehabilitation credit was claimed for the building. It states that, if a rehabilitation credit under IRC § 47 was claimed during the five preceding years, the deduction must be reduced by the ratio of the credits to the building's fair market value on the contribution date. The advice restates the conclusion under IRC § 170(f)(14) and notes that new regulations under § 1.170A-13 were being finalized.

Ruling snapshot

  • Question: How should rehabilitation credits claimed during the preceding five years affect a façade easement charitable contribution deduction?
  • Outcome: Advice given
  • Key authorities: IRC §§ 47 and 170(f)(14); Treas. Reg. § 1.170A-13

Full text (IRS public release)

ID: CCA-825121-09 Number: 200943034
Release Date: 10/23/2009
Office: ----------------
UILC: 170.14-01

From: -------------------
Sent: Tuesday, August 25, 2009 12:18
To: ------------------------
Cc: ---------------------------------------
Subject: RE: Façade Easement Brief June 2009

Here is the statement in the training slides that we prepared on façade easements:

If, during the 5 preceding years, a rehabilitation credit under section 47 was claimed for the building, the amount of the charitable contribution deduction must be reduced by the ratio of the sum of the credits over the fair market value of the building on the date of contribution.

Or, using your language in your email, I would just revise it as follows:

Under section 170(f)(14), the amount of the charitable contribution deduction is reduced by an amount which bears the same ratio as the rehabilitation tax credits allowed for the 5 preceding tax years over the fair market value of the building on the date of the contribution.

One additional reminder: As you know, we are finalizing new regulations under section 1.170A-13. When these regulations become final, we will need to revise the Façade Easement Brief 2009 to reflect those regulations.

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