Agnes is retired and has only a $12,000 annual pension as income. In 2016, Agnes' aunt dies and leaves her land worth $1.2 million. Agnes sees no need for the land and donates it immediately to a qualified public charity. Agnes may deduct a $1.2 million charitable contribution on her 2016 tax return.

Question

​Agnes is retired and has only a $12,000 annual pension as income. In 2016, Agnes' aunt dies and leaves her land worth $1.2 million. Agnes sees no need for the land and donates it immediately to a qualified public charity. Agnes may deduct a $1.2 million charitable contribution on her 2016 tax return.

Quizplus · Accepted Answer

Agnes can only deduct charitable contributions up to 50% of her adjusted gross income (AGI) for the year, with any excess carried forward for up to five years. Her AGI is $12,000, so she can only deduct $6,000 in 2016.

​Agnes Is Retired and Has Only a $12,000 Annual Pension

Agnes Is Retired and Has Only a $12,000 Annual Pension