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Rev. Rul. 1981-307 Document Info Printer

Revenue Rulings
Rev. Rul. 81-307

1981-2 C.B. 78, 1981-52 I.R.B. 8.

               Internal Revenue Service
                  Revenue Ruling

      CHARITABLE CONTRIBUTION; REWARD MONEY TO A POLICE DEPARTMENT

              Published: December 28, 1981

26 CFR 1.170A-1: Charitable, etc., contributions and gifts; allowance of
deduction

  Charitable contribution; reward money to a police department. A
contribution of reward money by a parent of a murdered individual to the
police department of a political subdivision for information leading to the
conviction of the murderer is for exclusively public purposes and is
deductible under section 170 of the Code.

ISSUE

  Is a contribution of a reward, as described below, deductible under
section 170 of the Internal Revenue Code?

FACTS

  A was murdered in 1980. B, A's parent, contributed 10x dollars to the
police department of CI to be used as a reward for information leading to
the conviction of A's killer or killers.  If the money is not used to pay
the reward, the police department will use the money for exclusively public
purposes. CI is a political subdivision described in section 170(c)(1) of
the Code.

LAW AND ANALYSIS

  Section 170(a)(1) of the Code allows as a deduction any charitable
contribution made during the tax year.

  Section 170(c)(1) of the Code defines a charitable contribution as a
contribution or gift to or for the use of a state, a possession of the
United States, any political subdivision of a state or possession, the
United States, or the District of Columbia, but only if the contribution or
gift is made for exclusively public purposes.

  Rev. Rul. 67-446, 1967-2 C.B. 119, holds that contributions are for 
'exclusively public purposes' when made to a city to enable it to provide
railroad companies with new facilities outside the city in exchange for the
railroads' removal of their inner-city facilities and relinquishment of
their right of way through the city.  The revenue ruling states that
although merchants and owners of property in the city who make
contributions may receive some benefit from the removal of the railroad
facilities, any benefit is incidental in comparison to the benefits
accruing to the public at large. See also:  Rev. Rul. 79-323, 1979-2 C.B.
106; and Rev. Rul. 69-90, 1969-1 C.B. 63.

  Rev. Rul. 74-246, 1974-1 C.B. 130, concerns an organization that makes
funds available to a police department to assist the department, as a
regular part of its operations, in offering rewards for information leading
to the apprehension and conviction of persons engaging in criminal activity
within a particular community.    The revenue ruling states that providing
funds to enable a police department to perform its regular duties assists
the government in carrying out its function.

  The establishment of the reward in this case helps the police department
of CI maintain the public safety and assists it in carrying out its
governmental functions.  Therefore, the reward serves an exclusively public
purpose and any benefit B receives from the conviction of A's killer or
killers is incidental in comparison to the benefits accruing to the public
at large.

HOLDING

  The contribution of 10x dollars by B to the police department of CI is
deductible as a charitable contribution in the manner and to the extent
provided under section 170 of the Code.

Rev. Rul. 81-307, 1981-2 C.B. 78, 1981-52 I.R.B. 8.

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