Your client, a carpenter, donated one of his handcrafted wooden desks to his church, a qualified public charity. The church sold the desk at an auction for $3,500, which is comparable to the standard price for the client's other woodwork. He calculated his costs as follows:Wood$1,000Other materials$300Rent for workshop$500Time and services$1,700This is his only charitable contribution. He itemizes deductions and has an adjusted gross income of $80,000.What is the maximum current year income tax deduction allowable for the client's charitable contribution? A)$3,500 B)$1,800 C)$500 D)$1,300

As per IRS rules , when a doner donates donation in kind , then the doner…

Answered: Your client, a carpenter, donated one…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Your client, a carpenter, donated one of his handcrafted wooden desks to his church, a qualified public charity. The church sold the desk at an auction for $3,500, which is comparable to the standard price for the client's other woodwork. He calculated his costs as follows:

Wood	$1,000
Other materials	$300
Rent for workshop	$500
Time and services	$1,700

This is his only charitable contribution. He itemizes deductions and has an adjusted gross income of $80,000.

What is the maximum current year income tax deduction allowable for the client's charitable contribution?

A)$3,500

B)$1,800

C)$500

D)$1,300

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