Financial Planner

Answer: B - A distinction is made between gifts that are used by a charity and gifts that are not used; they are referred to as use related and use unrelated, a gifted car that is given to a charity’s client is a use unrelated gift. For contributions to public charities, the deduction cannot exceed 30 percent of AGI if the full market value of the gift is deducted. The 30 percent limit can be increased to 50 percent of AGI if the donor is willing to reduce the value of the gift by 100 percent of the potential gain. For contributions to private charities, the deduction is 20 percent of the donor’s cost basis.