Joe, Who Is in the 33% Tax Bracket in 2012

Essay

Joe, who is in the 33% tax bracket in 2012, expects to retire in 2013 and be in the 25% tax bracket. He plans to donate $50,000 to his church. Because he will not have the cash available until 2013, Joe donates land (long-term capital gain property) with a basis of $10,000 and fair market value of $50,000 to the church in December 2012. He reacquires the land for $50,000 in February 2013. Discuss Joe's tax objectives and all tax issues related to his actions.