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Subject:  Re: More on Cap Gains Tax Bubbles Date:  12/14/1999  1:22 AM
Author:  ptheland Number:  23060 of 127753

I wrote:
I'm not sure what you mean by deducting 1/3 of home improvements. Can you elaborate?

frontaloeb responded:
-- technicality. We have a renter.

My reply:
I trust, then, that you are aware that you don't really *deduct* home improvements (repairs, yes; improvements, no). Improvements are capital in nature and must be depreciated over 27.5 years for residential rental real estate. (Just in case someone else reading might have the same situation.)

-- Know anything about 1-year lockup agreements? Does it work to donate shares now when the charity can not sell them for 1 year? What's the FMV in that case!?
:) I think this shelter will have to wait...

Other than they can get messy, no. But I don't think that would necessarily have a bearing on a charitable contribution - as long as you can, under the terms of the lockup agreement, transfer the stock to the charity. Granted, the lockup probably restricts *any* transfer, but I could see a charitable transfer as a possible exception. A valuation would likely take into account the restriction on the shares, but could still be done. And any capital gain would still escape all income tax.

I'll confess - I'm an ardent supporter of charitable giving. I hope I'm not coming across too strong here. I just like to find ways to reduce taxes as much as possible where giving is concerned.

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