Homework Answers
a) Because Donna had not held the stock to meet the long term requirement. Donna would have recognised a short term gain of ($30750-$21525) $9225 if she had sold the property.
But for charitable contributions the short term gain is treated as Ordinary income.
The deduction is limited to property basis is $21,525.
b) If the FMV is $18450,then $18450 is only considered as charitable deduction.
As FmV is less than basic the FMV will only be considered as charitable deduction
Thank you.
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