CFP

By Investopedia AAA

Charitable Contributions And Deductions - Sample Questions 1 - 5

1. You donate stock (held for two years) with a FMV of $20,000 to your church. Your AGI for the same year was $50,000. What is the amount of your allowable deduction in the year of the gift?

A) $20,000
B) $15,000
C) $10,000
D) $7,500

2.
All of the following statements are true EXCEPT:

A) Charitable contributions can be carried forward for up to five years.
B) Cash charitable contributions are deductible up to 50% of AGI.
C) Non-profit public hospitals are qualified public charities.
D) Donation of a $2,500 car will require a written appraisal.

3.
All of the following would be considered "qualified" public charities EXCEPT:

A) Republican Campaign Committee
B) Boy Scouts of America
C) Penn State University
D) United Way

4. Lefty bought a Hank Aaron baseball card in 1995 for $200. He donated the card to the Humane Society 15 years later when the card had a FMV of $800. Lefty has an AGI of $30,000 and he plans on itemizing his deductions. What is his charitable deduction if the Humane Society can sell the card for $800?

A) $100
B) $200
C) $400
D) $800


5. ABC Corporation donated seven boxes of new jackets (from inventory) to the Salvation Army, which cost them $2,000 to manufacture two years ago. ABC Corp has a total taxable income of $100,000 and the seven boxes of jackets have a FMV of $4,000. Which of the following are true statements?

I. ABC Corp's maximum allowable charitable deduction is $10,000.
II. ABC Corp's charitable deduction for the jackets is $4,000.
III. ABC Corp's charitable deduction for the jackets is $2,000.
IV. ABC Corp will have a $2,000 carry forward charitable deduction.

A) I and II only
B)
I and III only
C)
I, III and IV only
D) I and IV only

Answer Key
Related Articles
  1. Several things factor into the salary of a financial advisor. Here's a look.
    Investing Basics

    How Much Does A Financial Advisor Earn?

  2. With a long list of risks, losses associated with foreign exchange trading may be greater than initially expected. Here are the top 5 forex risks to avoid.
    Economics

    Top 5 Forex Risks Traders Should Consider

  3. ISAs are financial instruments that allow students to raise funds to pay for their degrees by selling shares in their future earnings.
    Investing Basics

    Funding Higher Education With An ISA

  4. Top Ways to protect your purchases from credit card hackers or security breaches.
    Credit & Loans

    7 Ways To Protect Against Credit Card ...

  5. The Internal Revenue Service's new 2015 contribution limits for tax-deferred savings plans are higher; here's what you and your clients should know.
    Investing Basics

    New 2015 Contribution Limits: Advisors ...

Trading Center