Cryptocurrency Donation Requires Appraisal

When property valued at over $5,000 is donated to charity, a qualified appraisal is required in order to take a deduction. No appraisal is required for the donation of publicly-traded securities. Does a donation of cryptocurrency fall within the exception to the appraisal requirement? The IRS said no (Chief Counsel Advice 202302123). The Tax Code defines a security as “a share of stock in a corporation; a right to subscribe for, or to receive, a share of stock in a corporation; or a bond; debenture, note, or certificate, or other evidence of indebtedness, issued by a corporation or a government or political subdivision thereof, with interest coupons or in registered form. Cryptocurrency does not fall into any of these categories, so it is treated like a donation of land, or art, or any other non-securities property. An appraisal is required even though a cryptocurrency is traded on a cryptocurrency exchange.