The Tax Court has denied a married couple a charitable contribution deduction for the value of a house they donated to a local fire department for training purposes.

Upen and Avanti Patel purchased the house in Vienna, Va., with the intent to demolish it and build a new house on the site.

The court held that a landowner’s grant to a fire department of the right to conduct training exercises and destroy the building during the exercises is a mere license that permits the fire department to do an act which, without such a grant, would be illegal and which conveyed no interest in the property to the fire department.

The couple donated only the use of the property and the house, which constituted a partial interest in the property.

However, the court found that the couple acted with reasonable cause and in good faith, and were therefore not liable for any accuracy-related penalty.

The case is Patel v. Commissioner of Internal Revenue (138 TC No. 23).

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