                  T.C. Memo. 2010-87



               UNITED STATES TAX COURT



               ANONYMOUS, Petitioners v.
     COMMISSIONER OF INTERNAL REVENUE, Respondent



Docket No. 6851-08.            Filed April 22, 2010.



Sealed, for petitioners.

Sealed, for respondent.
                                 -2-
             MEMORANDUM FINDINGS OF FACT AND OPINION


     PARIS, Judge:    This record has been sealed1 pursuant to

section 7461(b)2 and Rule 103.   Respondent determined a

deficiency of $5,903 in petitioners’ Federal income tax for the

tax year 2006.   After concessions,3 the Court must decide the

following issues:    (1) Whether petitioners are entitled to deduct

under section 170, as charitable contributions, $25,050 in wire

transfers4 petitioner wife made to her mother’s cousin, who

distributed the money for the benefit of the Catholic Church of

a foreign country; and (2) whether petitioners are entitled to

deduct under section 170 the airfare expense petitioner wife

incurred while rendering services to Catholic churches in a

foreign country.




     1
      On Jan. 30, 2009, this Court ordered the present record to
be sealed pursuant to sec. 7461(b) and Rule 103 because the risk
of extreme physical harm to petitioners outweighed the public
interest to have access to the court records. The record
demonstrated that petitioner wife already suffered actual harm,
and there would be risk of the same physical harm being inflicted
upon petitioner wife if the public had access to the records.
See Anonymous v. Commissioner, 127 T.C. 89 (2006).
     2
      Unless otherwise indicated, all section references are to
the Internal Revenue Code, as amended, and Rule references are to
the Tax Court Rules of Practice and Procedure.
     3
      Respondent conceded the other charitable contribution
deductions petitioners claimed for the tax year 2006.
     4
      Petitioner wife wired an aggregate of $25,050 but claimed
$25,100 as a charitable contribution deduction on petitioners’
2006 tax return. The amount at issue should then be $25,050.
                                  -3-
                           FINDINGS OF FACT

     Some of the facts have been stipulated and are so found.

The stipulation of facts and the attached exhibits are

incorporated herein by this reference.       Petitioner husband and

petitioner wife timely filed a joint tax return for the taxable

year 2006.   Respondent issued a notice of deficiency dated

December 17, 2007, disallowing certain charitable contribution

deductions they claimed for 2006.       Most of the disallowed

deductions originated from petitioner wife’s donations and

charity work for the benefit of Catholic churches and their

members in a foreign country.    Petitioners, who resided in Texas,

timely filed a petition.    Petitioner husband did not appear in

person at the trial of the case; petitioners retained counsel to

represent them.

     Petitioner wife was born in a foreign country.       Her parents

were devout Catholics.   Her father served as an officer in that

country’s army during the conflict with the guerilla forces.

Petitioner wife was a young girl when the guerrilla forces

initiated a military campaign.    Petitioner wife’s uncle was a

Catholic priest in her hometown.    When the guerrilla forces

seized her hometown, petitioner wife witnessed over 400 of her

fellow Catholics, including her uncle and other citizens of her

hometown, being buried alive.    Petitioner wife managed to escape

the massacre.   Nonetheless, the guerrilla forces destroyed much
                                 -4-
of her hometown, including the Catholic church and seminary.    The

foreign country’s government eventually fell.   Petitioner wife

and her family later escaped from their country to the United

States.   Petitioner wife later married petitioner husband.

Petitioner wife is now a U.S. citizen.   She is a member of a

church that belongs to the local Catholic diocese near her home

in Texas.

     In 1996 petitioner wife completed her college education and

was hired as an engineer at an international corporation.     After

completing college she returned to her native country and

witnessed extreme poverty.   Her experience motivated her to

contribute money and services to help rebuild Catholic churches

in that country.   These Catholic churches in her native country

provided food, education, and shelter to the poor.   During one of

her trips to her native country, the local police detained and

interrogated petitioner wife about her activities in the town

where she was born and raised.   The police also informed

petitioner wife that they had been monitoring her whereabouts in

the country and were aware of her family’s support for the former

government, mentioning these facts:    Her father had served as an

officer in the former government’s army and later was reeducated

by the present government after the former government fell; and

her uncle had worked for Catholic churches and died during the

siege of petitioner wife’s original hometown.
                                -5-
     Fearing for her life, petitioner wife devised a plan to

disguise her contributions to Catholic churches in her native

country.   She would wire the money to the personal bank account

of her mother’s cousin (cousin) who lived in petitioner wife’s

original hometown.   The cousin then transferred the money to

selected Catholic churches in that country.   Other than her

membership in a Catholic church, the cousin does not have any

formal role with the Catholic seminary or any other Catholic

institutions located in that country.   Petitioner wife wired to

the cousin’s account $8,025, $4,000, $5,000, and $8,025 during

the tax year 2006.   Petitioners claimed those amounts as

charitable contribution deductions on their joint income tax

return for 2006.   Petitioners also claimed a charitable

contribution deduction of $1,025 for the airplane ticket

petitioner wife purchased in 2006 to travel to her native country

and provide services to Catholic churches of that foreign

country.

     During her visits to her native country, petitioner wife did

not work on behalf of her local church while she was rendering

any charitable services to Catholic churches in that country.

However, she had informed her pastor of her financial

contributions and her services to Catholic churches in her native

country.   In November 2007 petitioner wife became a member of a

section 501(c)(3) organization that supports the work of
                                  -6-
missionaries in her native country.     Contributions to or for the

use of that organization may be deductible under section 170.

                              OPINION

     Section 170 allows taxpayers to claim a deduction for a

charitable contribution if the contribution is made to or for the

use of a qualified organization.    Only as a matter of legislative

grace may a taxpayer claim a deduction.    See INDOPCO, Inc. v.

Commmissioner, 503 U.S. 79, 84 (1992); New Colonial Ice Co. v.

Helvering, 292 U.S. 435 (1934).    Petitioners bear the burden of

proving that they are entitled under section 170 to the claimed

charitable contribution deductions for wire transfers to the

cousin, who distributed the money for the benefit of Catholic

churches in a foreign country and for any travel expenses

petitioner wife incurred in the performance of her charitable

services in that country under section 170.    Petitioners have

failed to demonstrate that the wire transfers to the cousin and

the expenses petitioner wife incurred in aiding the needy in a

foreign country are deductible under section 170 as donations to

qualified donees.   Section 170(c)(2) identifies an eligible

recipient of a charitable deduction as “a corporation, trust, or

community chest, fund, or foundation * * * created or organized

in the United States or * * * under the law of the United

States”.   Therefore, this Court concludes that petitioners are
                                -7-
not entitled to their claimed charitable contribution deductions

under section 170.

I. Wire Transfers to a Foreign Country

     Petitioners contend that petitioner wife’s wire transfers

are deductible under section 170.     Petitioners argue that the

ultimate beneficiary of the wire transfers was the Roman Catholic

Church, a qualified donee under section 170(c)(2), and that

petitioner wife thus made the wire transfers to or for the use of

a qualified organization.

     Relying on Winn v. Commissioner, 595 F.2d 1060 (5th Cir.

1979), affg. in part and revg. in part 67 T.C. 499 (1976),

petitioners dispute respondent’s contention that the transfers

went to or for the use of an organization in a foreign country.

This Court disagrees with petitioners that they donated the

proceeds of the wire transfers to or for the use of a qualified

organization under section 170(c)(2).

     Section 170(c)(2) defines “charitable contribution” as a

contribution or gift “to or for the use of” an organization

“created or organized in the United States * * * or under the law

of the United States”.   The Court of Appeals for the Fifth

Circuit, reversing in part the Tax Court decision in Winn v.

Commissioner, supra, held that the taxpayers made a deductible

charitable contribution of funds for the use of the Benoit

Presbyterian Church, which was created in the United States,
                                -8-
where an officer of the church received the donation at an event

it sponsored and subsequently those funds were used, as the

church intended, to support missionary work in a foreign country.

The Winn case differs from the present case.   Petitioner wife did

not make the wire transfers to or for the use of an organization

created or organized in the United States or under the laws of

the United States.   Petitioner wife’s contributions were made to

her mother’s cousin, who distributed them for the benefit of

foreign Catholic churches.   Therefore, her wire transfers of

$25,050 are not deductible as charitable contributions.

      Petitioners posit that the Catholic Church is a universal

organization, and therefore Catholic churches in petitioner

wife’s native country are qualified as donees under section 170.

Petitioners’ argument is flawed.   On this record, the Court has

no basis to find that the Catholic churches in that foreign

country to which petitioner wife’s wire transfers were

distributed were created or organized in the United States or

under the laws of the United States.   The language of section

170(c)(2) is explicit, and this Court must follow such plain

language.

     In arguing that the wire transfers were made for the use of

a qualified organization, petitioners rely on Davis v. United

States, 495 U.S. 472 (1990).   In Davis, the Supreme Court

interpreted the phrase “for the use of” a qualified organization
                                 -9-
to connote that the donation be to a legally enforceable trust or

a similar legal arrangement for the benefit of the qualified

organization.   Id. at 485.   The charitable beneficiary must have

a legal right to constrain the trustee to comply with the terms

of the trust relationship.    Id. at 483.

     Petitioners misinterpret Davis.      Even if the Court were to

assume for the sake of argument that the cousin received the wire

transfers in trust for the benefit of Catholic churches in that

foreign country, the Court has already concluded that these

churches have not been shown to qualify as organizations under

section 170(c)(2) and therefore that petitioners’ case does not

come within the purview of Davis.      Thus, no charitable

contribution deduction for the wire transfers is allowable under

section 170(c)(2).

II. Airfare to a Foreign Country

     Petitioners claim the cost of petitioner wife’s airfare as a

deductible unreimbursed expenditure incurred in the rendition of

services to a qualified organization under section 170.      This

Court disagrees with petitioners.      A taxpayer is permitted to

deduct under section 170 an unreimbursed expenditure made

incident to the rendition of services to an organization that is

a qualified recipient of charitable contributions.      Sec. 1.170A-

1(g), Income Tax Regs.   These expenditures include transportation
                                 -10-
expenses and reasonable expenses for meals and lodging while away

from home.   Id.

     Petitioners assert that the unreimbursed expenditure

incident to petitioner wife’s services during the year in

controversy should be deductible under section 170 because

petitioner wife worked on behalf of several qualified

organizations.     Nonetheless, petitioners have failed to show that

any of the Catholic churches in the foreign country to which

petitioner wife’s rendered services is a qualified organization

within the meaning of section 170(c)(2).     Petitioners also assert

that petitioner wife provided missionary services on behalf of

her local Catholic diocese.     Nonetheless, her local diocese did

not have control over petitioner wife’s services provided to the

Catholic churches in the foreign country, and no legally

enforceable trust or similar legal arrangement existed between

her local church (as a member of that diocese) and petitioner

wife.   See Davis v. United States, supra at 485.    Petitioner wife

did not render services in the foreign country under the

direction of, or to or for the use of her local church or the

local diocese.     The record shows only that her priest at her

local church had some awareness of her work in her native

country.   Nor is there any evidence that petitioner wife provided

those services during the year in controversy to or for the use
                              -11-
of the section 501(c)(3) organization of which she did not become

a member until 2007.

Conclusion

     The Court finds petitioner wife’s testimony to be sincere

and has no doubt that her actions were brave and heartfelt.

However, petitioners have failed to prove that they contributed

to a qualified organization under section 170.   Consequently,

petitioners are not entitled to their claimed charitable

contribution deductions for 2006.


                                          Decision will be entered

                                     under Rule 155.
