Question
Fatima loves the latest fashions, but she is also very charitable. She donates her previous year's clothing to Goodwill to make room in her closet
Fatima loves the latest fashions, but she is also very charitable. She donates her previous year's clothing to Goodwill to make room in her closet for this year's fashions. Fatima estimates the value of her donation to be approximately $6,000. Fatima recently learned that because her donation exceeds $5,000, she must support her donation with an appraisal and a signed statement by the appraiser on Form 8283. Fatima decides to claim a charitable deduction of $4,900 to avoid the appraisal requirement.
Please answer the following questions (label your work):
If Sabrinas clothes are worth $6,000, is she better off getting the appraisal or reporting a deduction of $4,900? Why?
What information would you need to answer this question? Provide a list and explain them.
Do you think the IRS may be suspicious of contributions below $5,000 in general? Why?
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