Charitable Giving with Appreciated Stock

Before you write that check for your charitable donation, consider making the gift with appreciated stock. Even with the stock market off of its recent highs, this may be the right time to use this particular strategy. One of the most tax-efficient ways to give is using appreciated securities from your investment account.

Any security with unrealized gains (meaning they have a current value greater than their cost) may be donated to a public charity and a tax deduction taken for the fair market value of the securities on the date of the gift at a level up to 30% of the donor’s adjusted gross income.

When securities are donated, any capital gains taxes from selling the securities will no longer apply.

Which of your investments are the best candidates for these donations? The answer to that question would be the stock holdings with the lowest cost basis (or missing cost basis).

Your gift of appreciated stock can be used to fulfill capital campaign obligations, make one-time gifts, fund a donor advised fund at a Community Foundation or even fund a Charitable Gift Annuity or Charitable Trust.

Even with the new standard deduction under the new tax laws, there is still a benefit to giving appreciated stock. You could make a large donation to a donor advised fund this year, get the deduction this year and then use the fund to make gifts over the next few years.

Please call your Altavista advisor if you are interested in exploring this charitable giving technique.

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