Roger transferred publicly trade stock valued at $100,000 to the Museum of Natur

Q: Roger transferred publicly trade stock valued at $100,000 to the Museum of Natur

Answer: C - Roger must report capital gain on his income tax return of $45,500 ($50,000 cash received - $4,500 allocable basis) This is because the basis of stock was only $9,000 in the market. Had he kept it with himself, he would have got nothing. So, indirectly there was a capital gain for him. Also, option b cant be right because even if it was a gift, then every person is required to report the gift on Form 709.

ID: 2561813 • Letter: R

Question

Roger transferred publicly trade stock valued at $100,000 to the Museum of Natural History for $50,000 cash. Roger's basis in the stock is $9,000. This is his only gift for the year. Which of the following is correct?

A) Roger may claim a charitable contribution of $50,000 on his income tax return (subject to any applicable limitation).

B) Roger is not required to report the gift on Form 709.

C) Roger must report capital gain on his income tax return of $45,500 ($50,000 cash received - $4,500 allocable basis)

D) All of above.

Explanation / Answer

Answer: C - Roger must report capital gain on his income tax return of $45,500 ($50,000 cash received - $4,500 allocable basis)

This is because the basis of stock was only $9,000 in the market. Had he kept it with himself, he would have got nothing. So, indirectly there was a capital gain for him.

Also, option b cant be right because even if it was a gift, then every person is required to report the gift on Form 709.

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Roger transferred publicly traded stock valued at $100,000 to the Museum of Natu

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Roger transferred publicly trade stock valued at $100,000 to the Museum of Natur

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