>
>>> absent any real research, I'll vote that it is a gift by the
>>> museum to the initial donor. If I donate money to a charitable
>>> organization, take the deduction, and years later fall on hard
>>> times and receive from that charitable organization some benefits,
>>> those do not strike me as "income".
>>
>> Nonprofits are not allowed to make "gifts" but can make distributions
>> to the extent that they are within their exempt purpose. Normally the
>> exempt purpose of a museum is not to help the destitute, so it would be
>> improper for them to do that.
>
> I am not suggesting the museum was helping the destitute. I was
> suggesting, as you are (apparently) that it is ok for the museum, under
> limited circumstances, to return the painting to the donor, if it is in
> their charter/bylaws, etc. and fills a legitimate purpose. And, if so, I
> believe this distribution does not constitute income to the recipient.
> Another poster indicated that the recipient's basis in the painting is now
> zero, so he would have no charitable deduction if he gave it away again.
Stuart, reading a couple more of your posts that just popped up, I see that you are not suggesting that it is ok for the museum to return the painting. I didn't mean to put words in your mouth.