If donated appreciated capital gain property is put to a use that is unrelated to the purpose or function of a charity's tax-exempt status,the contribution must be reduced by the amount of any long-term capital gain that would have been realized if the property had been sold at its fair market value at the time of the contribution.

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This statement is true. According to IRS regulations, if a donor contributes appreciated capital gain property to a charity and the property is put to an unrelated use, the contribution must be reduced by the amount of any long-term capital gain that would have been realized if the property had been sold at its fair market value at the time of the contribution. This rule is designed to prevent donors from avoiding capital gains taxes by making charitable contributions of appreciated property that is not directly related to the charity's mission or purpose.

If Donated Appreciated Capital Gain Property Is Put to a Use