Rita, Who Has Marginal Tax Rate of 39 B) C)

Rita, who has marginal tax rate of 39.6%, is planning to make a gift to her grandson who is in the lowest tax bracket. Which of the following holdings of stock would be the most tax advantageous gift from Rita's perspective?

A) $\begin{array}{|l|l|l|}\hline\text { Stock } & \text { FMV } & \text { Adjusted Basis } \\\hline \text { A } & \$ 25,000 & \$ 12,000 \\\hline\end{array}$
B) $\begin{array}{|l|l|l|}\hline\text { Stock } & \text { FMV } & \text { Adjusted Basis } \\\hline \text { B } & \$ 25,000 & \$25,000 \\\hline\end{array}$
C) $\begin{array}{|l|l|l|}\hline\text { Stock } & \text { FMV } & \text { Adjusted Basis } \\\hline \text { A } & \$ 25,000 & \$3,000 \\\hline\end{array}$
D) For income tax purposes, Rita will be indifferent as to choice of stock to gift.