Steve made the following transfers during the year: $10,000 to Louisiana State U

Question

Steve made the following transfers during the year: $10,000 to Louisiana State University. The $10,000 contribution allows him to purchase football season tickets. Steve also bought the football season tickets at a cost of $5,000. $400 to the local public broadcast television station during the annual fund drive. In return for the $400 contribution, Steve received a mug and pen with the station’s logo valued at $8. 1,000 shares of ABC stock to the United Way. At the date of the contribution, the stock had a fair market value of $50 per share. Steve’s adjusted taxable basis in the stock was $10 per share and he held the stock long term. Ignoring any AGI limitations, what is Steve’s maximum charitable income tax deduction for this year? Please show your work.

(a) $18,400. (b) $50,400. (c) $55,392. (d) $58,400.

Explanation / Answer

Answer:d)$58400

Ignoring any AGI limitations , steve could deduct 80% of the $10000 contribution or $8000.
The $400 contribution to the public broadcast television station will not be reduced by the value of the mug and pen becasue those items are considered deducted.
Without any AGI limitations , the full fair market value of the stock contribution may be deductible $50000($50*10000)
$8000+$400+$50000=$58400

Related Questions

Navigate

• Browse (All)
• Browse S
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.