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From: johnson@saturn.UUCP (Mark Scott Johnson)
Newsgroups: net.taxes
Subject: Double Deductions
Message-ID: <2026@saturn.UUCP>
Date: Fri, 23-Mar-84 11:07:22 EST
Article-I.D.: saturn.2026
Posted: Fri Mar 23 11:07:22 1984
Date-Received: Sun, 25-Mar-84 19:29:03 EST
Organization: Hewlett Packard Labs, Palo Alto CA
Lines: 22

> Mark Scott Johnson doesn't know of anyplace in the tax code that allows
> something to be deducted twice.  Here is one:

> Say you have owned some investment (stock, gems, collectibles,
> whatever) long enough to qualify for long term capital gains, and the
> time has come to sell at a profit.  If you wish to make a donation to a
> charitable organization, you can get a double deduction by giving away
> the investment.  Since the item is not sold, no tax is paid on the
> gain.  The "fair market value" however may be taken as a deduction.

I only count one deduction here--when you give the investment away.  The
original cost of the investment was NOT deducted previously.

What's described above is a tax-free transaction (the capital gains
on the investment is forgiven).  There are LOTS of tax-free transactions
(e.g., municipal-bond dividends, like-kind property exchanges, scholar-
ships, loan proceeds, honoraria from professional societies).

-- 
Mark Scott Johnson
CSnet:  Johnson@HP-Labs
USENET: ...!ucbvax!hplabs!johnson