Benefits of Giving Stock and Non-Cash Assets

Tax Savings of Gifting Stock or Other Non-Cash Assets


Now may be an ideal time to consider a gift of long-term assets that have appreciation with tax consequences. Contact Geri Jacobs at 214-750-4255 for details on how to donate stock, real estate or other non-cash assets.

Due to favorable tax provisions and with careful planning, a gift of securities or other non-cash assets held for more than one year enables you to claim an income tax deduction on the fair market value and avoid capital gains tax on the appreciation.

Case in point: a donor wants to give $50,000 to Communities Foundation of Texas (CFT) before year-end, which can be funded either with cash or appreciated stock. The donor is in the 33 percent income tax bracket, and the stock value is $50,000 with a cost basis of $10,000. If the stock has been held for more than a year, the charitable deduction would be based on the fair market value on the gift date. By using the appreciated stock instead of cash, a donor would save an additional $6,000. A higher federal tax bracket would further improve the results.

The federal government encourages charitable giving by allowing you to deduct up to 30 percent of adjusted gross income each year when a gift is made of appreciated securities. In addition, if you are unable to use the entire amount of the allowable deduction in one year, the excess tax deduction can be carried over for five additional years. On the other hand, if you are holding securities that have depreciated in value, it may be best to sell them, write off the loss and establish or add to a fund with the proceeds.

Gifts of appreciated assets can be extremely beneficial--both to you and to the charitable organizations you support.

 

Geri Jacobs, ChFC, CLU
Director of Charitable Gift Planning
214-750-4255
gjacobs@cftexas.org

Carolyn A. Newham, JD
Senior Director of Donor Relations & Fund Administration
214-750-4146
cnewham@cftexas.org

Contact one of us with questions about giving non-cash assets.

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