ITX - 43A Flashcards
(43.1) Charitable contributions will reduce taxable income for clients whose total itemized deductions exceed the ___ deduction.
standard
(43.1) Only gifts to ___ organizations are deductible. Donations to ___ are not.
- tax-exempt
- individuals
(43.1) Examples of private charities
- veterans organizations
- fraternal orders
- private foundations
(43.1) Examples of public charities
- churches
- schools
- hospitals
- governmental entities
- Red Cross
- Salvation Army
- United Way
(43.2) If a taxpayer wants to donate funds to charitable causes but has not yet selected specific charities, the taxpayer can contribute funds to a ___ fund.
donor-advised fund
(43.2) The donor-advised fund provides the taxpayer with the up-front charitable deduction and the ability to ___.
spread out charitable gifts over a period of years
(43.2) The deduction for charitable gifts of cash to public charities is limited to ___% of the donor’s AGI.
50%
(43.2) For cash gifts to private charities, the limit is the lesser of ___% of AGI or the difference between ___% of AGI and donations to public charities.
- 30%
- 50%
(43.2) Travel for charitable purposes may be deducted by the donor based either on a rate of ___ cents per mile or on actual expenses for gas, oil, interest, and taxes on the car.
14
(43.2) Appreciated Property: The deduction for gifts of property is generally the ___ of the property on the date of donation. This rule applies to gifts of appreciated capital gain property (held more than one year) if it is ___.
- FMV
- intangible
(43.2) Appreciated Property: The deduction for gifts of TANGIBLE property is ___, if it is not used in the donee’s charitable purpose, or ___, if it is used in the charitable purpose.
- the donor’s basis
- FMV
(43.2) Appreciated Property: Gifts of ordinary income property such as inventory, copyright work in the hands of the creator, and capital gain property held less than one year provide a deduction of only ___.
the donor’s basis
(43.2) The deduction for gifts of property is limited to __% of AGI for gifts to public charities and __% of AGI for gifts to private charities. The limit can be extended to __% of AGI for gifts to public charities of appreciated capital gain property if the amount of the gift is reduced to only the donor’s basis.
- 30%
- 20%
- 50%
(43.3) Any charitable contribution that is disallowed because of the limitation with respect to AGI is carried forward for __ years and may be deducted on future returns.
5
(43.3) Partial-Interest Gifts to Charity: Generally, gifts to charity of less than an entire interest in property will not be ___. Exceptions include property held in a ___.
- deductible
- charitable lead trust or charitable remainder trust, remainder interest in a residence or farm, and other property if that is the donor’s entire interest.
(43.3) Nondeductible contributions: No deductions is allowed for a donor’s contribution of __ to a qualified charity or for donations of the __ of property.
- time
- use
(43.3) Nondeductible contributions: No charitable deduction is allowed for a transfer to a charity of a ___ life insurance policy if the charity directly or indirectly pays the premiums on the policy covering the donor.
split-dollar
(43.4) When gifts of property are claimed as deductions in excess of $___ and are not publicly traded stock or cash, a donor must obtained a ___ for each item donated and must include a copy of the appraisal with his or her tax return.
- $5,000
- qualified appraisal
(43.4) Appraisals: If the donation is of nonpublicly traded securities, an appraisal is not needed until the donation exceeds $___.
$10,000
(43.4) Substantiation Requirements: For gifts of cash under $__, a cancelled check will satisfy the substantiation requirements.
$250
(43.4) Substantiation Requirements: For noncash contributions over $___, in addition to the written acknowledgement from the charity, Form ___ must be attached to the donor’s return.
- $500
- Form 8283
(43.4) Substantiation Requirements: If a taxpayer donates a vehicle worth $___ or more, the charity must report the gross proceeds on the sale of the vehicle to the taxpayer
$500
(43.4) When a charitable contribution is made that is directly related to the donor’s business, and there is a reasonable expectation of a financial return on the amount given, the cost may be taken as a ___ deduction rather than as a ___ contribution. The contribution would not be subject to the __ limitation for C corporations and would not be a separately stated item for pass-through entities.
- business
- charitable
- 10%
(43.5) Deductions and Calculations - Public Charities: Cash donations
up to 50% of the donor’s AGI
(43.5) Deductions and Calculations - Public Charities: Long-term capital gain property (appreciated property)
up to 30% of the donor’s AGI or 50% of AGI if valued at the donor’s basis
(43.5) Deductions and Calculations - Public Charities: Property producing ordinary income when sold
up to 50% of the donor’s AGI
use basis when calculating deductions
(43.5) Deductions and Calculations - Private Charities: Cash donations
up to 30% of the donor’s AGI
(43.5) Deductions and Calculations - Private Charities: Long-term capital gain property (appreciated property)
up to 20% of the donor’s AGI
(43.5) Deductions and Calculations - Private Charities: Property producing ordinary income when sold
up to 30% of the donor’s AGI
use basis when calculating deductions
