A Tax Break for Erotica- Do You Think It's Fair?

A while back, a New York dominatrix named Ann Marie Coughlin ("Domina M.") donated her brushed-steel bondage machine to the Museum of Sex in Manhattan. The Museum of Sex weren't the only ones to benefit from their new piece, Ms. Coughlin also got a tax deduction out of the deal. But there's still a fierce debate surrounding this type of tax deduction- many thing erotic items don't deserve a tax deduction.

The Real Issue: The real debate, though, is that the Museum of Sex is not a tax-exempt organization, it's a for-profit company. But The Museum of Sex does take advantage of a certain IRS loophole to get around this. They have a tax-exempt affiliate, the Muse Foundation of New York, which takes in tax-deductible donation for the museum's collection. Under the tax code, private companies are allowed to have dealing with nonprofit organizations the are affiliate with.

What the IRS Says: Bruce I. Friedland, a spokesman for the IRS had this to say, “Where concerns occur, the issue is whether the tax-exempt organization is operating for the substantial private benefit of the for-profit entity."

What Do You Think? Personally, I so no cause for alarm or debate regarding these donations. But what do you think? Do you think it's fair or shifty?