Recent years have been good ones for stocks in particular, but selling appreciated shares triggers taxation that can exceed 23.8 percent of the capital gain. By transferring them instead directly to Treasure Coast Hospice Foundation you avoid tax on the gain and receive a tax deduction for the fair market value of the stock. Thus, the value of your gift to us may far exceed its net cost to you.
When you make charitable gifts to us with appreciated assets (assets you have held for over one year and that has grown in value), such as stock, bonds or mutual funds, you receive a double tax benefit. A charitable deduction is allowed for the current fair market value and the capital gain is not taxed, meaning you in essence receive a tax break for appreciation on which you never paid taxes. By using appreciated assets, the gift actually costs you less!
The chart below illustrates the tax benefits when using appreciated assets:
Cash Gift vs. Stock Gift
| Cash Gift | Stock Gift | |
| Gift Value | $10,000 | $10,000 |
| Income tax deduction | $10,000 | $10,000 |
| Income tax saved (@ 37% rate)* | $3,700 | $3,700 |
| Stock purchase price | $1,000 | |
| Increase in value | $9,000 | |
| Tax avoided on gain (@ 20% rate) | $1,800 | |
| Total tax savings | $3,700 | $5,500 |
*Assumes you are itemizing your deductions and not using the standard deduction
Most gifts of stock can be made easily via electronic transfer. Even if you like your investments, you can give your appreciated shares and use cash to replace them with shares with a higher cost basis.
By using your appreciated securities you can make a tax-wise gift and ensure that Treasure Coast Hospice continues its mission to provide individuals at the end of life access to compassionate, caring, expert and professional health care services
Note: If you want to provide support by using securities worth less than you paid for them, you should sell them and contribute some or all of the cash proceeds. You can then use the loss on the sale to offset other income.
