A business machine valued at $800 was contributed to a charitable organization during the year. fte machine cost $1,000 but was depreciated down to $600 before the donation was made. Indicate the correct income tax treatment with respect to the donation.
A) Contribution of $600 (no income recognized)
B) Contribution of $1,000 (income of $200 recognized)
C) Contribution of $800 (income of $200 recognized)
D) Contribution of $800 (no income recognized)
E) None of the above

Question

Quizplus · Accepted Answer

An ordinary income property charitable deduction is limited to basis. the re is no income recognition when making a charitable donation.

A Business Machine Valued at $800 Was Contributed to a Charitable