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30 June, 20:59

Pat gave 5,000 shares of stock in Coyote Corporation (a publicly traded corporation) to her church (a qualified charitable organization) in the current year. The stock was worth $180,000. She had acquired it as an investment four years ago at a cost of $120,000. She reported AGI of $300,000 for the year. In completing her current income tax return, how much is her current-year charitable contribution deduction? a.$120,000 b.$180,000 c.$150,000 d.$90,000 e. None of these choices are correct.

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  1. 30 June, 22:27
    0
    d.$90,000

    Explanation:

    given data

    shares of stock = 5,000

    stock was = $180,000

    four years ago cost = $120,000

    AGI = $300,000

    solution

    we know that as per capital gain property in general rule Pat deduct will be as

    deduct = 30% of AGI ... 1

    deduct = 30% of $300,000

    current deduct = $90,000

    and

    remaining will be as

    remaining = fair market value - current deduction ... 2

    remaining = $180,000 - $90,000

    remaining = $90,000

    so remaining amount carry over up to 5 years

    so correct option is d.$90,000
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