741 / What value of property contributed to charity can be considered for the charitable deduction if the gift is long-term capital gain property?

Long-term capital gain property. “Long-term capital gain” means “gain from the sale or exchange of a capital asset held for more than one year, if and to the extent such gain is taken into account in computing gross income.”²

Any portion of a gift of long-term capital gain property to a 60 percent-type organization that is disallowed as a result of the adjusted gross income limitation may be carried over for five years, retaining its character as a 30 percent type deduction (see Q 740).³

A taxpayer may elect in any year to have gifts of long-term capital gain property be subject to a 50 (or 60) percent of adjusted gross income limit; if he does so, the gift is valued at the donor’s adjusted basis. Once made, such an election applies to all contributions of capital gain property during the taxable year (except unrelated use gifts of appreciated tangible personal property, as explained in Q 742) and is generally irrevocable for that year.⁴

The deduction for any charitable contribution of property is reduced by the amount of gain that would not be long-term capital gain if the property were sold at its fair market value at the time of the contribution.⁵