Stocks, bonds and mutual funds are types of securities that can be donated to an organization as a tax-deductible gift.
Example: Ralph and Marge have a significant portfolio of highly appreciated stock that is subject to equally significant capital gains tax if they sell it. Recently, they learned that using the stock for some of their giving to ministry might make good financial sense.
In a typical year, Ralph and Marge have been giving $5,000 to their favorite ministry. This year, however, rather than writing a check, they donated $5,000 in shares of appreciated stock. The ministry sold the shares providing cash to do their mission. For the ministry, the gift was virtually the same as past gifts from Ralph and Marge.
The results for Ralph and Marge, however, were important. Along with a charitable tax deduction for the fair market value of the donated stock, they also avoided the capital gains tax that would have been paid had they sold the stock. In addition, they can use the normally donated cash for any purpose they choose. And, of course, they still made their desired gift to their favorite ministry.
The following chart compares the value of contributing appreciated stock to charity with the result of to selling the stock and then making a gift of the after-tax cash. This illustration assumes a 23.8% combined federal and state capital gains tax rate.
Closely held securities can also be used to make charitable gifts – but may require a higher level of planning.Â
With all contributions of securities, it is important to consult your tax professionals to be sure you are accomplishing your generosity desires in the most cost-effective way for both you and the recipient ministry.
Ready to Make a Gift of Securities?
Please share Biblica’s account information with your broker or financial advisor. Please inform us once the transfer is made because your name will not be on the transfer and we will not know who gave it. Do not sell the stocks yourself and then give the proceeds to Biblica because you will lose some of the tax advantages.
Biblica’s account information.
Transfer the securities directly to Biblica’s account by using our Charles Schwab DTC number (Depository Trust Company) and account number below:
DTC number: 0164
Account number: 1907-9044
Biblica’s Tax ID EIN: 84-1194554
Account Title/Registration: Biblica, Inc.
Contact Name and Phone: Randy Nelson, 719-867-2625
Name of Receiving Institution: Charles Schwab
Please contact as when you have made the stock transfer at [email protected] as the donor’s name often does not appear on the transfer information we receive.
Consult your financial or tax advisor for advice and tax deductions. Stocks, bonds or mutual funds given to Biblica will be sold immediately.
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