For-Profit College Owner Beats IRS in $300 Million Donation Tiff

The US Tax Court determined that the owner of several for-profit colleges made a charitable contribution when he offloaded them in 2012, partly overruling the IRS’s determinations that the transaction wasn’t legitimate.

The court rejected financial models put forth by both the IRS and Carl B. Barney, but determined he made a proper election of the 2012 transfer as a sale below fair market value under 26 C.F.R. § 1.1011-2. But it remains unclear if he over paid or under-paid his taxes, Judge Christian N. Weiler said in a Tuesday opinion.

In 2012, Barney undertook a transaction to ...