Donating winning lottery ticket to 501(c)3 Private Foundation: cost-basis deduction + full tax free redemption for foundation?
US 501(c)3 Private Foundations are typically controlled by the primary donator, so that is a nice perk, but in exchange for that perk I realize the tax deductions for donating are significantly lowered than for charities. Aside from being lower, the tax code doesn't recognize appreciated property and only allows for a deduction based on the donating taxpayer's cost-basis: ie. the price they paid for the property no matter its current market value.
When there is a significant delta of price paid vs current redeemable value, it seems this can still be a perk for the donating taxpayer in some circumstances, such as with lottery tickets that are known winners already.
If the donating taxpayer pays for the ticket. Their cost basis is . If the ticket is now worth 0,000,000 but has not been redeemed, is it accurate that the donating taxpayer can donate this to their private foundation for a deduction at cost basis, and the private foundation can redeem the 0,000,000 ticket completely exempt from all lottery withholding income taxes?
(Other taxes unique to private foundations are known and outside the scope of this question.)
Most literature I can find is about appreciated marketable securities, and occasionally real estate. It doesn't seem that the tax code specifies any distinction between property, but it also doesn't seem the answer to this question is part of the general collective conscious even if it really is that obvious if my understanding is already correct.
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