- Days left

Metallica frontman James Hetfield feels charitable

James HetfieldMetallica singer and guitarist James Hetfield may well be feeling charitable around the holidays. The Marin County Board of Supervisors just voted unanimously to accept Hetfield's donation of 330 acres overlooking California's Lucas Valley. The land is to be preserved as farmland.

Hetfield has previously donated more than 400 acres to the county for use as open space.
Both parcels are around Hetfield's home.

The donation is a nice-enough story. But the real story? Hetfield's land-use consultant, Scott Hochstrasser, is a genius. Here's why: the donations make Hetfield look good, they may garner him a generous tax deduction and they afford him something that he may not have a lot of -- privacy.

If his gift qualifies as a charitable deduction, and it's been owned for more than a year, Hetfield may be entitled to a charitable deduction equal to the entire fair-market value of the property. For individual taxpayers, the deduction would be limited to a 30% limit of adjusted gross income -- but eligible to be carried over for 5 years for the portion of the deduction that goes unused.

To qualify for a federal income tax deduction, the land or easement must be donated to a public charity or government entity (here, Marin County). The donation must serve at least one of the following conservation purposes:
  • the preservation of land areas for outdoor recreation by, or the education of, the general public;
  • the protection of a relatively natural habitat of fish, wildlife or plants, or similar ecosystem;
  • the preservation of open space (including farmland and forest land) where such preservation is for the scenic enjoyment of the general public or pursuant to a clearly delineated Federal, State or local governmental conservation policy, and will yield a significant public benefit, or
  • the preservation of an historically important land area or a certified historic structure.
Since the contribution is to be used to promote "agricultural conservation efforts", the donation would appear to serve a number of those purposes. In other words, it would seem to qualify for purposes of a federal income tax donation.

Further, by restricting the rights of others to develop the land (a key part of most charitable donations of real property), Hetfield has ensured that a full slate of McMansions won't sprout up next to his home. It will stay green, attractive and - best of all - private.

It's a win-win. One wonders why more celebs don't follow Hetfield's lead.

Increase your money and finance knowledge from home

How to Avoid Financial Scams

Avoid getting duped by financial scams.

View Course »

Understanding Credit Scores

Credit scores matter -- learn how to improve your score.

View Course »

TurboTax Articles

Video: Tax Guidelines About Gifting

Note: Some of the content of this video applies only to taxes prepared prior to 2012. It is included here for reference only. Find out the tax guidelines about gifting with help from TurboTax in this video on tax tips.

Video: What are Income Tax Rates?

Note: The content of this video applies only to taxes prepared for 2010. It is included here for reference only. Income tax rates change depending on both the amount of money you make and how you made it. Find out about income tax rates with help from TurboTax in this video on tax tips.

Video: How To Reduce Errors on Your Tax Return

Did you know that errors on your tax return can affect the amount of your tax bill and the amount of time it takes to get a refund? Fortunately, TurboTax helps you avoid errors AND be sure you're getting all the tax deductions and credits you deserve.

Does Your Company Need to File Form 1095-B?

A company is responsible for filing IRS Form 1095-B only if two conditions apply: It offers health coverage to its employees, and it is "self-insured." This means that the company itself pays its employees' medical bills, rather than an insurance company. A company that doesn't meet both conditions won't have to deal with Form 1095-B. Its employees might still receive a 1095-B, but from their insurer, not the employer.

Video: Who Qualifies for an Affordable Care Act Exemption (Obamacare)?

The Affordable Care Act requires all Americans to have health insurance or pay a tax penalty. But, who qualifies for an Affordable Care Act exemption? Find out more about who qualifies for an exemption from the Affordable Care Act tax penalty, how to claim an exemption on your tax return and how the Affordable Care Act may affect your taxes with this video from TurboTax.

Add a Comment

*0 / 3000 Character Maximum