1. Mary has an AGI of $80,000 which is expected to remain at this level for the next 5 years. She wants to donate 1,000 shares of XYZ stock to a public hospital. She purchased the shares eight years ago at an adjusted basis of $40 per share and the current fair market value is $135 per share. If she wants to maximize her income tax deductions for this year which of the following would you recommend?

1. Mary should deduct $135,000 for the stock donation this year
2. Mary should deduct $80,000 for the stock donation this year
3. Mary should deduct $40,000 for the stock donation this year
4. Mary should deduct $24,000 for the stock donation this year

2. Mary has an AGI of $80,000 which is expected to remain at this level for the next 5 years. She wants to donate 1,000 shares of XYZ stock to a public hospital. She purchased the shares eight years ago at an adjusted basis of $40 per share and the current fair market value is $135 per share. If she wants to maximize her income tax deductions for the next six years which of the following would you recommend?

1. Mary should deduct $135,000 for the stock donation this year
2. Mary should deduct $80,000 for the stock donation this year
3. Mary should deduct $40,000 for the stock donation this year
4. Mary should deduct $24,000 for the stock donation this year

1. Louis Gardener established a charitable remainder trust which will pay income for life to Louis and the remainder to a local charity. Which of the following statements concerning the trust is (are) correct?

I If the trust assets are includible in Gardeners gross estate, the federal estate tax charitable deduction will apply to these assets.

II Gardener can take an income tax deduction in the year the trust is created for the present value of the remainder interest.

(A) I only (C) Both I and II

(B) II only (D) Neither I nor II