Representation before the IRS · Supporting documentation

Other substantive and contemporaneous documentation

The rule

Most tax evidence is judged on whether it persuades. A narrow and important set of documents is judged on when it was made, and for those the timing is not a factor going to weight — it is a condition of the deduction. A practitioner needs to know which documents are in that set, because for them nothing done after the fact repairs the omission.

Charitable contributions at or above the threshold. No deduction shall be allowed (IRC § 170(f)(8)(A)) for a contribution of $250 or more per contribution, requiring a contemporaneous written acknowledgment from the donee organization^TY2026 unless the taxpayer substantiates it by a contemporaneous written acknowledgment from the donee organization. The acknowledgment must contain 3 items — the amount of cash and a description (but not value) of any non-cash property contributed; whether the donee provided any goods or services in consideration; and a description and good faith estimate of the value of any such goods or services, or a statement that they consisted solely of intangible religious benefits^TY2026. And “contemporaneous” is defined, not left to judgement: the acknowledgment must be obtained on or before the earlier of the date the return for the year of the contribution is filed, or the due date including extensions for that return^TY2026. An acknowledgment obtained after the return is filed is not contemporaneous even if it is obtained the following week, and the deduction is gone.

Travel, gifts and listed property. Section 274(d) requires substantiation by adequate records or by sufficient evidence corroborating the taxpayer’s own statement. Reg. § 1.274-5T(c)(2) defines adequate records as an account book, diary, log, statement of expense, trip sheet or similar record, together with documentary evidence, which in combination establish each required element^TY2026. The regulation explains why the timing matters: a record made at or near the time of the expenditure or use, supported by sufficient documentary evidence, has a high degree of credibility that a statement prepared afterwards lacks, because there is generally a lack of accurate recall. A statement not made at or near the time is not disqualified — but the corroborative evidence supporting it must have a high degree of probative value to reach the credibility a contemporaneous record would have had.

Everything else. Corporate minutes, board resolutions, contemporaneous memoranda, engagement letters, valuation opinions and internal accounting records fall under the general regime of IRC § 6001 and Reg. § 1.6001-1, which requires permanent books of account or records, including inventories, sufficient to establish the amount of gross income, deductions, credits, or other matters required to be shown on the return^TY2026. There is no statutory timing condition here — but the evidentiary logic of Reg. § 1.274-5T(c) applies as a matter of common sense wherever a document purports to record a decision or a purpose. A resolution dated at the time reads as a record of what was decided; the same words drafted three years later read as an argument.

Current figures

How it works in practice

Check the acknowledgment before the return goes out, not before the examination. This is the single most useful thing a preparer does on this topic, because the deadline is the earlier of the filing date and the due date including extensions. Once the return is filed, a missing acknowledgment cannot be cured. The practical control is a checklist item: for every contribution at or above the threshold, does the file hold an acknowledgment containing the amount or description, the goods-and-services statement, and a valuation or intangible religious benefit statement where applicable?

The goods-and-services statement is the part most often missing. Many acknowledgments recite the amount and stop. Section 170(f)(8)(B)(ii) and (iii) require a statement of whether the organization provided goods or services in consideration, and a description and good faith estimate of their value where it did — or a statement that they consisted solely of intangible religious benefits. An acknowledgment silent on that point does not meet the requirements, and the omission is easy to fix before filing and impossible afterwards.

Corporate minutes are evidence of authorisation and purpose. Where a payment’s character depends on what the entity decided and why — a bonus versus a distribution, a loan versus a dividend, a reimbursement under an accountable plan, a compensation level for a shareholder-employee — minutes made at the time are strong evidence and minutes reconstructed later are weak. They are also, frequently, the only contemporaneous record of a related-party arrangement whose terms were never reduced to a contract.

Do not backdate anything, and do not accept a backdated document. A document created later and dated earlier is a false document. Circular 230 § 10.22 requires due diligence in preparing and filing documents relating to IRS matters, and there is no version of this that is a grey area. Where a client offers to “put something in the file,” the answer is that a document created now, dated now, describing what happened then, is legitimate evidence of a lesser weight — and a document dated then is a problem for both of you.

Reconstruct openly where reconstruction is available. On the general track, a memorandum written now that records what a person recalls, identifies the surrounding documents that corroborate it, and says when it was written, is admissible evidence and is worth having. Its value comes from its honesty about its own provenance. On the § 170(f)(8) track it is worth nothing, because the statute conditions the deduction on a document from a third party obtained by a date that has passed.

How this has changed

Section 170(f)(8) was enacted by the Omnibus Budget Reconciliation Act of 1993 and applies to contributions made in taxable years beginning after 1993. It was a deliberate hardening: before it, a cancelled cheque could substantiate a cash gift of any size, and the goods-and-services disclosure that now sits at the centre of the requirement did not exist. Courts have applied the deadline strictly, including against taxpayers whose donee organizations were willing and able to issue the acknowledgment later.

Section 274(d) and its temporary regulations date to 1962 and 1985 respectively, and the definition of adequate records has not moved. What has moved is what falls inside the section: computers and peripheral equipment left the listed property definition in § 280F(d)(4) for property placed in service after 2017, while property of a type generally used for entertainment, recreation or amusement remains listed property.

The general regime has not changed at all in principle, but the medium has: electronic records satisfy Reg. § 1.6001-1, and metadata now frequently establishes when a document was actually created — which has made backdating both easier to attempt and easier to detect.

Exam focus

Know the charitable acknowledgment rule cold: contributions at or above the stated threshold, a contemporaneous written acknowledgment from the donee, containing the amount or description, the goods-and-services statement, and a valuation or intangible religious benefit statement, obtained by the earlier of the filing date and the due date including extensions. Know that a record made at or near the time of a § 274(d) expenditure carries a credibility a later statement must work to match. Expect a question testing that a late-obtained acknowledgment does not save the deduction.

Check yourself

1. By when must a contemporaneous written acknowledgment be obtained?

A. Before the IRS opens an examination B. By the earlier of the date the return is filed or the due date including extensions C. Within one year of the contribution D. At any time before the assessment period expires

Answer: B.

2. Which is not a required content item of the acknowledgment?

A. The amount of cash contributed B. Whether the organization provided goods or services in consideration C. The value of any non-cash property contributed D. A good faith estimate of the value of any goods or services provided

Answer: C. The acknowledgment describes non-cash property but does not value it — valuation is the donor’s responsibility.

3. A taxpayer’s mileage log is prepared after year end. What follows under § 274(d)?

A. The deduction is automatically disallowed B. The log qualifies as adequate records C. It may serve as the taxpayer’s own statement, but the corroborating evidence must have a high degree of probative value D. The burden shifts to the IRS

Answer: C.

4. A client asks the practitioner to prepare a log dated as of the prior year. What is the correct response?

A. Prepare it, since the underlying facts are true B. Prepare it and note in the file that it was created later C. Refuse; prepare a current-dated statement identifying the corroborating evidence instead D. Prepare it only if the client signs a representation

Answer: C. A document created later and dated earlier is a false document.

5. What is the primary tax value of contemporaneous corporate minutes?

A. They satisfy IRC § 274(d) for entity travel B. They evidence authorisation and purpose at the time a decision was made C. They extend the assessment period D. They substitute for a written acknowledgment of a corporate charitable gift

Answer: B.