Arnold Made a Charitable Contribution of Property That He Valued

question 149

Essay

Arnold made a charitable contribution of property that he valued at $70,000. He deducted this amount as an itemized deduction on his tax return. The IRS can show that the actual value of the property is $50,000. Arnold is in the 35% income tax bracket. Determine Arnold's amount due for both tax and any penalty.

---

Definitions:

Bankruptcy Petition Preparers

Individuals or entities that assist debtors in completing their bankruptcy documents without offering legal advice.

Discharged

The action of being released or relieved from an obligation, duty, or debt.

Tax Consequences

The effects that financial or legal decisions have on one's taxes owed to the government.

Bankruptcy Code

The set of laws codified under Title 11 of the United States Code, governing bankruptcy proceedings in the U.S.