Stewart had adjusted gross income of $22,000 in 2018.During the year, he made the following contributions to qualified charities:- $7,000 cash- 1,000 shares of Able Corporation common stock, acquired in 1990 (cost and fair market value of $5,000)Considering the charitable contribution deduction limitation, what amount can Stewart claim as a deduction for charitable contributions in 2018?

Question

Quizplus · Accepted Answer

Stewart can deduct cash contributions up to 60% of his AGI and appreciated stock up to 30% of his AGI. The cash contribution limit is $13,200 (60% of $22,000), and the stock contribution limit is $6,600 (30% of $22,000). Since the stock's fair market value is $5,000, he can deduct the full amount. Therefore, the total deduction is $7,000 (cash) + $5,000 (stock) = $12,000.

Stewart Had Adjusted Gross Income of $22,000 in 2018