Self Storage Units Charity Donation Tax Issue

[Brandon Yuan]

Hi all

I got a question here. I acquired a self storage facility last year. Previous owner donated 9 storage unit for free to a national charity organization for their use. They issued a donation confirmation letter each year with estimated rental value (let’s say $50/month times 9 units times 12 months) as donation value, and the previous owner use it as charitable donation tax deduction. Always! However, now my CPA told me that we can’t claim such donation as deduction because of the so called “partial interest rule”. From what I read online, basically the rule says we can only claim tax deduction if we donate the whole ownership/interest of the property instead of partial (like my entire self storage facility?!) The article used an example of owning a 10 story office building but only donating 1 floor to charity organization's use, and that is not tax deductible. I understand what the rule says, but it doesn’t make any logical sense to me. Is it a correct interpretation of the rule that the entirety has to be donated? And donating units/space as free rent to use is not donating the interest (ownership) of those 9 units, so this is not even applicable rule in this scenario?

Anyone has experience/knowledge on this topic?