Tara Lynn Angulo
CharitablePlanning.com Author
Biography
Tara L. Angulo received her Bachelor of Science degree in Criminal Justice Studies, with a focus on Human Services Administration, from the University of Phoenix, AZ, in 2012. She also obtained her Master of Arts degree in Law, with a focus on Advanced Paralegal Studies, from Regent University, VA, in 2020. She is currently attending Vermont Law and Graduate School, where she is pursuing her Juris Doctorate. She is expected to graduate with the Class of 2026.
Tara has a wide range of legal skills acquired both academically and professionally. She is a member of the National Association of Charitable Gift Planners and has attended numerous seminars on charitable and estate planning. She has also obtained her Chartered Advisor in Philanthropy (CAP) Designation from the American College of Financial Services. She serves on the board of the Christian Law Fellowship as Secretary and on the board of the Veterans' Student Law Association as the Treasurer at Vermont Law and Graduate School. She was previously on the board of the Women's Law Society as the Public Relations Chairperson.
Tara has not always been in charitable and estate planning, previously gaining some experience in contract and employment law shortly after graduating with her MA. She also has extensive knowledge and expertise in logistics and inventory management, both in the medical and government aerospace fields.
Tara is originally from Rhode Island but has lived in over six states, as her husband is an active-duty member of the United States Marine Corps. They currently reside in Oceanside, CA. They share two children and spend most of their free time actively volunteering as coaches for youth sports teams for military children.
How Far is Too Far - Who is Your Judge?-
This paper examines the complex legal issues when a donor gives an appreciated, non-cash asset to a tax-exempt charity shortly before an intended sale. On the sale of the asset, will the donor or the charity be treated as the taxable party? The central question is how much pre-arrangement between the donor and a third-party buyer is permissible before the donor has gone "too far" in arranging the sale of the asset, and the IRS can successfully argue the donor is taxable under the doctrine of "assignment of income."
The foundational case of Palmer (1974) and Revenue Ruling 78-197 established a clear test: donors avoid taxation unless the charity is "legally bound or can be compelled" to sell the donated asset. This objective standard has provided predictable guidance for charitable planning for years.
However, individual judges have applied varying and sometimes contradictory legal theories to similar fact patterns. Pro-taxpayer decisions in Palmer, Greene, Rauenhorst, and Dickinson contrast sharply with pro-IRS outcomes in Blake, Ferguson, and Hoensheid. These latter courts (sometimes a single judge) have moved beyond the objective "legal obligation" test of Palmer and the Revenue Ruling, introducing problematic subjective standards.
The Second Circuit in Blake suggested that mere "understanding" or "expectation" of sale could be sufficient for taxation, even without legal enforceability. Similarly, Ferguson and Hoensheid expanded liability based on whether sales were "practically certain" or "virtually certain." However, these cases holding for a subjective standard could have been decided based upon the objective standard of "legally bound," and their ultimate expressions of a subjective standard were dicta in each case.
The paper reveals several danger zones for donors to avoid and recommends that planners still focus on the objective standard of Palmer and Revenue Ruling 78-197.