Joseph Thompson is president and sole shareholder of Jay Corporation. In December 2015, Joe asks your advice regarding a charitable contribution he plans to have the corporation make to the University of Maine, a qualified public charity. Joe is considering the following alternatives as charitable contributions in December 2015: Fair Market Value
(1)Cash donation $200,000
(2) Unimproved land held for six years ($110,000 basis) 200,000
(3) Maize Corporation stock held for eight months ($140,000 basis) 200,000
(4) Brown Corporation stock held for nine years ($360,000 basis) 200,000
Joe has asked you to help him decide which of these potential contributions will be most advantageous taxwise. Jay's taxable income is $3,500,000 before considering the contribution.
Rank the four alternatives, and complete the letter to Joe communicating your advice.
Note: The land and stock are "unrelated use property" but they are not "tangible personal property".