Actual Charitable Contributions

In determining net earnings for the purpose of computing the excise tax, T.C.A. § 67-4-2006 requires the charitable contributions deduction claimed under Section 170 of the Internal Revenue Code to be added to federal taxable income; whereas, § 67-4-2006 permits a deduction for actual charitable contributions made by the taxpayer during the fiscal year. The term “actual charitable contributions” means all bona fide contributions expensed and paid in a given year without regard to any percentage as required under federal law. The same criteria used for federal purposes in determining whether or not a contribution is a bona fide contribution is used by this state; however, only the book basis of property donated to charity is allowed as a deduction in determining net earnings for the purpose of computing the excise tax.