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.
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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