Christa has made a $25,000 pledge to the American Red Cross (a public charity). Christa expects AGI of $200,000 this year. Which of the following assets should she donate?
A) $25,000 of cash
B) stock purchased three years ago for $18,000 with a current FMV of $25,000
C) stock purchased six months ago for $28,000 with a current FMV of $25,000
D) Christa should be indifferent among the three choices.
B) stock purchased three years ago for $18,000 with a current FMV of $25,000
All of the options will provide a deduction of $25,000, but the appreciated stock will provide the $25,000 deduction without recognizing the gain. Christa will never get the tax savings on the loss stock if she donates it.
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