Anesthesiologist Bernard Broad saw an opportunity to cut his taxes.

At $59.14 each, Broad purchased 186 Philadelphia Memorial Park grave sites. As promised, the seller persuaded a park official to write a letter saying they usually sold for $300. After donating them to two churches, Broad deducted $300 for each. This was a grave mistake.

The Internal Revenue Service allowed only $60.00 for each site.

* * * * * * * * * * * * * * * * * * * *

Many taxpayers attempt to exploit tax rules in making charitable donations. Some are dreamers, as in the grave sites case, duped into buying a bunch of gems or bibles with promises of deductions far exceeding cost. Others, such as the next two cases, attempt to capitalize without any encouragement from others.

William G. McConnell subdivided his farm into building lots and put in streets and sewer lines. Under a Hermitage, Pa., city ordinance, he could either keep the streets and sewer lines or give them to the city. He gave them to the city.

The IRS disallowed his charitable deduction, saying it was self-serving, that he hoped to avoid future maintenance costs.

* * * * * * * * * * * * * * * * * * * *

Richard B. Skala, a U.S. airline pilot, offered to buy a luxurious air-yacht once owned by the king of Saudi Arabia. The present owner, the Saudi Arabian Air Force, had little use for the amphibious aircraft in the desert country.

Skala bought it for $3,000 and spent $6,000 getting it to the United States. He then donated it to the Bradley Air Museum in Windsor Lock, Conn.

Even though restoration of the aircraft would cost $150,000, Skala claimed a $145,000 charitable deduction. The IRS said it would allow $3,000.

The court, more generous than the agency, recognized that Skala got a bargain purchase. It allowed $18,000 -- a deduction twice his costs.(more at Charitable Contributions)

THE MORAL: The plane truth-donation must be grounded in reality.