SECURITIESRead the
WARNING! first.
In general it is often more advantageous, from a tax-saving standpoint, to give an organization appreciated securities rather than cash. Like a gift of cash, securities are deductible at their market value on the day of the gift. By writing a check for cash, you get a full tax deduction for that amount on your federal income tax, if you itemize. The appreciated portion of securities, however, is untaxed if given to charity. If you bought stock or a mutual fund for $500 that is worth $1,000 the day they are given, it cost you only $500 for a charitable deduction of $1,000. And, you avoided paying capital gains tax on the appreciation. By transferring appreciated stocks, bonds or mutual fund shares which you have owned long term (one year or longer), you get a deduction for the full market value, and you get an additional benefit: your gift allows you to avoid paying tax on the capital gains. Before a gift of securities is made, proper arrangements should be made with the charitable organization. The organization must ensure that it can receive and deal with the securities, and make a proper recognition of the gift. Marketable securities held in a brokerage or trust account can usually be transferred electronically to the account of a charitable organization. Marketable securities held in physical certificate form should be delivered to or mailed to the charitable organization, with a signed stock power sent under separate cover. The donor's signature on the stock power also must be guaranteed by a bank officer or stockbroker, not a notary public. For assistance with a making a donation of securities, contact us. |
