Blue Corporation donates the following property to The Corporate Income Tax Corporations Johnson Elementary School XYZ Corporation stock purchased two years ago for $25,000 The stock has a $19,000 FMV on the contribution date ABC Corporation stock purchased three years ago for $2,000 The stock has ...

a 47000 charitable contribution deduction determined as follows Property Bas ...

Blue Corporation donates the following property to The Corporate Income Tax? Corporations Johnson Elementary School: XYZ

Question:

Blue donates the following property to The Corporate Income Tax? Corporations Johnson Elementary School:
• XYZ stock purchased two years ago for $25,000. The stock has a $19,000 FMV on the contribution date.
• ABC stock purchased three years ago for $2,000. The stock has a $16,000 FMV on the contribution date.
• PQR stock purchased six months ago for $12,000. The stock has an $18,000 FMV on the contribution date.
The school will sell the stock and use the proceeds to renovate a classroom to be used as a computer laboratory. Blue’s taxable income before any charitable contribution deduction, dividends-received deduction, or NOL or capital loss carryback is $400,000.
a. What is Blue’s charitable contributions deduction for the current year?
b. What is Blue’s charitable contribution carryback or carryover (if any)? In what years can it be used?
c. What would have been a better tax plan concerning the XYZ stock donation?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...