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§ 6.3 GIFTS OF MONEY BY CREDIT CARDA charitable gift involving a postdated check becomes deductible as of thedate of the check, assuming that all other requirements are satisfied. 21 A checkinvolving a charitable gift that has not cleared the bank prior to the death of thedonor gives rise to a federal income tax charitable contribution deduction as ofthe time the check was delivered to the donee. 22A postdated check is essentially a promissory note; the rules concerninggifts by promissory notes are discussed below. 23§ 6.3 GIFTS OF MONEY BY CREDIT CARDAn income tax charitable contribution can be made, and be deductible, by meansof a credit card. When a gift is made using a bank-based credit card, the contributionis deductible for the year the donor charges the gift on the account (ratherthan for the year when the account including the charged amount is paid). 24 Inreaching this conclusion, the IRS concluded that the credit card holder, by usingthe card to make the contribution, became immediately indebted to a third party(the bank) in such a way that the cardholder could not thereafter prevent thecharitable organization from receiving payment. This is because the credit carddraft received by the charitable organization from the credit card holder is immediatelycreditable by the bank to the organization’s account as if it were a check.In this regard, the IRS analogized this situation to that in which a charitablecontribution is made using borrowed funds. The IRS reasoned as follows: “Sincethe cardholder’s use of the credit card creates the cardholder’s own debt to athird party, the use of a bank credit card to make a charitable contribution isequivalent to the use of borrowed funds to make a contribution.” 25 The generalrule is that when a deductible payment is made with borrowed money, thededuction is not postponed until the year in which the borrowed money isrepaid. 26 These expenses must be deducted in the year they are paid and notwhen the loans are repaid.Gifts by means of a bank credit card are to be distinguished from gifts bymeans of a promissory note and the like. 27 The issuance of a promissory note (ordebenture bond) represents a mere promise to pay at some future date, and deliveryof the note (or bond) to a charitable organization is not a requisite “payment.” 2821 Griffin v. Commissioner, 49 T.C. 253, 261 (1967), in which the Tax Court wrote: “A postdated check is not acheck immediately payable but is a promise to pay on the date shown. It is not a promise to pay presently anddoes not mature until the day of its date, after which it is payable on demand the same as if it had not been issueduntil that date although it is, as in the case of a promissory note, a negotiable instrument from the time issued.”22 Spiegel Estate v. Commissioner, 12 T.C. 524 (1949). Consequently, these funds should not be in the donor’sestate for estate tax purposes. Belcher Estate v. Commissioner, 83 T.C. 227 (1984). This rule does not apply,however, with respect to gifts by check written to noncharitable donees. McCarthy v. United States, 86-2U.S.T.C. 13,700 (7th Cir. 1986).23 See § 6.7.24 Rev. Rul. 78-38, 1978-1 C.B. 67. This ruling revoked Rev. Rul. 71-216, 1971-1 C.B. 96, which held that aperson making a contribution to a qualified charitable organization by a charge to a bank credit card is entitledto a charitable contribution deduction for the amount contributed in the tax year in which the donor paid theamount to the bank.25 Rev. Rul. 78-38, 1978-1 C.B. 67, 68.26 Granan v. Commissioner, 55 T.C. 753 (1971).27 See § 6.7.28 Rev. Rul. 78-38, 1978-1 C.B. 67. 175