Trust is donating 20 acres of land to the school district to build a new school. The basis of the land at time of donation is $40,000.
Part of the agreement of this donation says the trust must make certain land improvements worth $2 million. The school is paying the trust this $2 mil and the trust pays the contractors.
My question is: The donation is $40,000 and the capital gain is $0, right? Trust received this money, but in turn paid it out for improvements.
Part of the agreement of this donation says the trust must make certain land improvements worth $2 million. The school is paying the trust this $2 mil and the trust pays the contractors.
My question is: The donation is $40,000 and the capital gain is $0, right? Trust received this money, but in turn paid it out for improvements.