Recognizing the excess purchase price of selling the church property as a donation/contribution from the purchaser

by Kenneth
(Ohio)

We sold our church for an amount significantly higher than the market value. The purchaser's attorney says the excess payment can be treated as a donation/contribution to the church.

A deposit was received in 2016. The Treasurer provided acknowledgement of the deposit as a gift and also noting the donor did not receive any goods or services in exchange for their donation.

I recently took over the Treasurer position and it's time to prepare the annual contribution statements. The purchaser of our church will be expecting such an acknowledgement for the balance of the excess purchase price paid in 2017.

The county's auditor valuation was used to determine market value. I'm pretty sure our church did not consult with a Tax Attorney.

I don't feel very confident that this would be an allowable tax deduction and have concerns about providing an acknowledgement letter.

Any comments are much appreciated.