eduorg <eduorgjj[at]yahoo.com> wrote:

- quote -

Just that method used to be better for the owner than
keeping the money: tax rates were as high as 70% (sometimes
higher), so the trick worked.

With current rates, it doesn't work as well (there's
after-tax cost rather than benefit to doing it), but the
situation you describe should be the case *provided that the
charity makes the decision to sell the stock*. (If the
stock is donated subject to an agreement to redeem it, I
think a different rule kicks in.)

Note that while owner starts out and leaves with full
control and gets a tax deduction, the company has less
value.

Seth

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does it work? can it work?

Private corporations owner donated shares in it to charity.
Charity (voluntarily ??) redeems shares for cash.
Owner gets deduction for full value (mostly appreciation).
Corpoartion empties its coffers tax free
Owner still in full control of corp.
How can that be??
Owner starts out and leaves with full control and still has
tax deduction.

<< ================================================== ===== > << The foregoing was not intended or written to be used, > << nor can it used, for the purpose of avoiding penalties > << that may be imposed upon the taxpayer. > << > << The Charter and the Guidelines for submitting posts > << to this newsgroup as well as our anti-spamming policy > << are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >