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For the current year, Gina Hestopolis had adjusted gross income of $100,000. During the year, she contributed $6,000 to her church and an additional $3,000 to qualified charities. She also contributed religious artwork with a fair market value of $60,000 and a basis of $20,000 to her church. The church intends to display the religious artwork in the church foyer. What is the amount of the charitable contribution carry forward beyond the current year for Gina Hestopolis

User Yira
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2 Answers

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Final answer:

Gina Hestopolis made cash and artwork charitable contributions that exceed the AGI deduction limits, and the amount beyond these limits can be carried forward to future tax years.

Step-by-step explanation:

The student asks about the charitable contribution carry forward for Gina Hestopolis, who has an adjusted gross income of $100,000 and made various contributions to her church and qualified charities, including a high-value artwork donation. The Internal Revenue Service (IRS) has rules that limit the amount of charitable contributions that can be deducted in a given year to a percentage of adjusted gross income (AGI). For 2021, a taxpayer may deduct contributions up to 100% of AGI for cash contributions to qualifying organizations and up to 30% for contributions of appreciated assets, like artwork. Since Gina contributed a total of $9,000 in cash and artwork valued at $60,000, and assuming she opts to deduct the fair market value of the artwork, her total contributions of $69,000 would exceed the AGI limitations. The excess amount may be carried forward to future tax years.

User Ordous
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2 votes

Answer:

$39,000

Step-by-step explanation:

This can be calculated as follows:

Charitable contribution to carry forward = Contribution to church + Contribution to qualified charities + Half of the fair market value of contributed religious artwork

Therefore, we have:

Charitable contribution carry forward = $6,000 + $3,000 + ($60,000 รท 2) = $39,000

Therefore, the amount of the charitable contribution carry forward beyond the current year for Gina Hestopolis is $39,000.

User Narann
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