m Cengage Leaning-Mouilla Firefor ignmentMain.doinvoker- &takeAssignmentSessionL
ID: 2582380 • Letter: M
Question
m Cengage Leaning-Mouilla Firefor ignmentMain.doinvoker- &takeAssignmentSessionLocator; assignment takeainprogress-faise fox Take Survey Leam Mone Exercise 10-20 (LO. 6) Corporation to the American Red Cross on September 10, 2017. She purchased the stock for $18,100 Donna donates stock in Chipper on December 28, 2016, and t had a fair market value of $27,000 when she made the donation. 25,200 x for a. The stock is treated as ordinary income V property and Donna's charitable contribution deduction is tax purposes had a fair market value of $15,000 (rather than $27,000) when it was donated to the American Red b. Assume instead that the stock Cross. Donna's charitable contnibution deduction would be s 21,600 x for ta 170 allows individuals and corporations to deduct contributions made to qualfied domestic organizations. Contributions to qualfied chantable organizations serve certain social welfare needs and thus relieve the government of the cost of providing these needed services to the community. The charitable contribution provisions are among the most complex in the tax lawExplanation / Answer
SOLUTION:
1) The stock is treated as ordinary income property and Donna's charitable contribution deduction is $18100 for tax purposes
2) Assume instead that the stock had a fair market value of $15,000 (rather than $27,000) when it was donated to the American Red Cross. Donna's charitable contribution deduction would be $15000 for tax purchases.
Explanation: The stock for stock for $18,100 will be allowed for deduction in case I; and stock had a fair market value of $15,000 thus Donna's charitable contribution allowed for deduction would be $15000
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