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SPECIAL GIFT SITUATIONS(b) Law and AnalysisA charitable contribution deduction is denied for certain contributions of partialinterests in property. 116 A charitable deduction is denied for a contribution ofless than the taxpayer’s entire interest in property unless the value of the interestcontributed would be allowable as a deduction 117 if the donor were to transferthe interest in trust. 118 This rule does not disallow a deduction for a contributionof an interest that, even though partial, is the taxpayer’s entire interest in theproperty. If, however, the property in which the partial interest exists wasdivided in order to create the interest, the deduction is not allowed. 119There is a deduction for a contribution, not in trust, of a partial interest thatis less than the donor’s entire interest in property if the partial interest is anundivided portion of the donor’s entire interest. 120A contribution of the right to use property that the donor owns, such as acontribution of a rent-free lease, is a contribution of less than the taxpayer’sentire interest in the property. 121 If a taxpayer contributes an interest in motionpicture films, but retains the right to make reproductions of the films and exploitthe reproductions commercially, the contribution is less than the taxpayer’sentire interest in the property. 122The IRS ruled that the contribution in the first of the Revenue Ruling 2003-28situations was a transfer of a partial interest, for which no charitable contributiondeduction is allowable. The license granted to the university was deemed similar tothe rent-free lease and the partial interest in motion picture films, in that it constitutedneither the person’s entire interest in the patent, nor a fraction or percentageof each and every substantial interest or right that the person owns in the patent.If, as of the date of a gift, a transfer of property for charitable purposes isdependent on the performance of an act or the happening of a precedent event tobecome effective, there is no charitable deduction, unless the possibility that thecharitable transfer will not become effective is so remote as to be negligible. 123 If, asof the date of a gift, a transfer of property for charitable purposes may be defeatedby the performance of an act or the happening of an event, no deduction is allowableunless the possibility that the act or event will occur is so remote as to be negligible.124 Thus, a charitable deduction was not allowed in the second situation.When a donor places a restriction on the marketability or use of property, theamount of the charitable contribution deduction is the fair market value of theproperty at the time of the contribution, determined in light of the restriction. 125Generally, then, in the third situation, there is a deductible contribution. The restriction,however, reduced what would otherwise have been the fair market value ofthe patent, and therefore reduced the amount of the charitable contribution.116 See § 9.23.117 IRC § 170(f)(2).118 IRC § 170(f)(3)(A).119 Reg. § 1.170A-7(a)(2)(i).120 IRC § 170(f)(3)(B)(ii).121 Reg. § 1.170A-7(a)(1).122 Reg. § 1.170A-7(b)(1)(i).123 Reg. § 1.170A-7(b)(1)(i). See § 10.4(b).124 Reg. § 1.170A-7(a)(3). See § 10.4(b).125 See § 10.1(a). 284