The West Ohio Conference Council on Development office has received several calls recently asking about stock donation. If you are considering a charitable contribution, let us help. Gifting appreciated stock is one of the most effective means of tax savings available.
The Benefits of Gifting Appreciated Stock
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The satisfaction of knowing your money is invested in a cause important to you.
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Capital gains taxes on the stock are avoided.
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You will be eligible to receive an income tax charitable deduction for the full fair-market-value of the stock at the time of the gift.
To qualify for these special tax advantages, the security must have been held for at least one year. A gift of stock in certificate form should be postmarked by December 31 or your financial advisor can arrange for a year-end gift of stock from your account.
Your gift of appreciated stock is fully deductible up to 30% of your adjusted gross income. For example, if your adjusted gross income is $100,000, up to $30,000 of long-term appreciated stock and other capital gain property may generally be deducted, although high-income donors may be subject to a partial phase-out of itemized deductions. Any excess can generally be carried forward and deducted over as many as five subsequent years.
How Giving Away $10,000 in Stock can Benefit You
Look at the tax savings of donating securities versus a cash gift. The chart below assumes you wish to donate shares of stock worth $10,000 that you purchased for $2,000 several years ago.
|
Donate appreciated security outright |
Donate $10,000 cash |
Sell securities and donate cash |
Charitable Deduction |
$10,000 |
$10,000 |
$10,000 |
Tax Savings (35% rate) |
$3,500 |
$3,500 |
$3,500 |
Capital Gains tax paid (15% rate on $8,000 gain) |
$1,200 saved |
N/A |
$1,200 paid |
Net tax savings |
$4,700 |
$3,500 |
$2,300 |
Contact the Council on Development Office and we will provide fee-free instructions. You may reach us at Stan Ling sling [at] wocumc.org or Cat Lyle at clyle [at] wocumc.org or by phone at 614-844-6200 Ext. 222.