Gifts of Appreciated Securities: Stocks, Bonds, Mutual Funds, and Other Assets

Smart gift planning combines charitable intent with cost-efficient planning techniques. Of critical importance is the kind of asset used to fund the gift. Usually, long-term appreciated property can generate the most favorable tax benefits. Reason: Gifts of such property provide a double benefit—a charitable deduction, in most cases, for the full fair-market value of the property—plus avoidance of any potential capital-gain tax.

The chart below illustrates the additional tax savings from a gift of appreciated assets.

   
Cash
Appreciated Property
A. Fair-Market Value
10,000
10,000
B. Cost Basis
10,000
4,000
C. Capital Gain
0
6,000
D. Capital-Gain Tax (15%)
0
900
E. Charitable Deduction
10,000
10,000
F. Actual Tax Savings (28%)
2,800
2,800
G. Total Tax Savings (D+F)
2,800
3,700

 

For additional information, please call 1-877-426-2838 ext. 3228.

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