1.

Clarice, age 90, has accumulated $1.5 million in net assets. Included in this are three blocks of stock: Stock A has a basis of $300,000 and a fair market value of $400,000; Stock B has a basis of $400,000 and a fair market value of $200,000; Stock C has a basis of $100,000 and a fair market value of 400,000. Clarice needs $200,000 now to pay off the mortgage on her daughter's home and she wants to make a $400,000 donation to her Church either as a lifetime or testamentary transfer. Which assets should she sell to accomplish this with the least current tax cost?

Select one:

a. Sell Stock C and leave Stock B to the Church upon her death.

b. Sell Stocks A and C now.

c. Sell Stock B and leave stock C to the Church upon her death.

d. Sell Stock A and leave stock C to the Church upon her death.