Maura makes a gift of a van to a local food bank run by a charity.Maura had used the van in her trade or business.The van has a FMV of $6,500; a cost of $31,000; and $27,000 depreciation claimed.What is the amount of Maura's charitable contribution deduction?
A)$6,500
B)$31,000
C)$4,000
D)$2,500

Question

Quizplus · Accepted Answer

The charitable contribution deduction for property used in a trade or business is limited to the lesser of the fair market value or the property's adjusted basis (cost minus depreciation). The adjusted basis is $31,000 - $27,000 = $4,000. Since $4,000 is less than the FMV of $6,500, the deduction is $4,000.

Maura Makes a Gift of a Van to a Local