charitable

[TAXMAN]

Have a 1041 return. Sale of stock results in loss. Has a specific charitable donation in will of $5000. No other income in Final estate return. Ex gives church the $5000 and paid its legal fee from the gross proceeds of the sale then gives heir remainder.

Can heir use this $5000 as a charitable deduction?

Page 2 of 1041 says charity paid from gross income. Even tho gain is a loss do I still put the $5000 on that line?

Thanks to anyone who can help. I've not run into this b-4.

[jainen]

>>Can heir use this $5000 as a charitable deduction?<<

I don't think so. First of course the heir did not donate anything, just didn't inherit as much as hoped. And there isn't any charitable deduction anyway, because the donation was made out of the estate's principal, not income. The capital loss can be deducted by the estate in the ordinary way, or passed to the heir when the estate is closed. (In calculating gain or loss, remember the basis is stepped down to FMV at date of death.)