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SPECIAL GIFT SITUATIONS4. The donee is not a private foundation. 455. The donee’s use of the property is related to the donee’s tax-exemptpurposes. 466. The property “is to be used by the donee solely for the care of the ill, theneedy, or infants.”7. The property is not transferred by the donee in exchange for money, otherproperty, or services.8. The donor receives from the donee a written statement representing thatits use and disposition of the property will be in accordance with theserules.9. The property is in compliance with all applicable requirements of the FederalFood, Drug, and Cosmetic Act.A contribution of property, to be deductible pursuant to these rules, must bea qualified contribution. A qualified contribution is one that satisfies the foregoingnine requirements. 47(b) Restrictions on UseFor a contribution to qualify under these rules, the contributed property must besubject to certain restrictions on use. If the transferred property is used or transferredby the donee organization (or by any subsequent transferee that furnishedto the donee the requisite written statement 48 ) in a manner inconsistent with therequirements of these rules, the donor’s deduction is only the amount allowablewith regard to gifts of inventory in general. 49 As noted, this general deduction isconfined to the donor’s cost basis.If the donor is, however, able to establish that, at the time of the contribution,the donor reasonably anticipated that the property would be used in amanner consistent with these requirements, then the donor’s deduction willnonetheless be computed using these special rules. 50Exempt Purpose Use. Under these rules, the use of the property must berelated to the purpose or function constituting the ground for tax exemption as acharitable entity of the organization to which the contribution is made. 51 The giftproperty may not be used in connection with any activity that gives rise to unrelatedbusiness income. 52Ultimate Beneficiaries. The gift properties must be used for the care of the ill,needy, or infants. The property itself must ultimately either be transferred to (or45 See § 3.5. The donee, however, can be a private operating foundation.46 See § 3.5.47 Reg. § 1.170A-4A(b)(1).48 See text accompanied by note 72.49 Reg. § 1.170A-4A(b)(2).50 Id.51 Reg. § 1.170A-4A(b)(2)(i).52 Id. The unrelated business income rules are summarized at § 3.5. 274