Question

Jinhee purchased a ticket to a concert to raise money for the local university. The ticket cost $250, but the normal cost of a ticket to this concert is $75. How much is deductible as a charitable contribution?

Answer 1

Answer:

Amount deductible as a charitable contribution=$175.

Explanation:

Given data:

Cost at which the ticket is purchased=$250

Actual cost of the ticket=$75

Required:

Amount deductible as a charitable contribution=?

Solution:

Any amount above the fair market value/Normal value will be the deductible charitable contribution.

In our case:

Amount deductible as a charitable contribution=Cost at which the ticket is purchased - Actual cost of the ticket.

Amount deductible as a charitable contribution=$250-$75.

Amount deductible as a charitable contribution=$175.