When deciding what to contribute to a charity, consider appreciated non-cash assets. Your cash donation is always welcome, but appreciated non-cash assets held more than a year can help you achieve maximum philanthropic impact and also help you reduce your taxes. Did you know that you can potentially eliminate the capital gains tax you would incur if you sold the assets yourself and simply donated the proceeds? You may also claim a fair market value charitable deduction for the tax year in which the gift is made, and can also choose to pass on that savings in the form of more giving. Talk with your tax advisor for details, but here is one example:
Perhaps you own a stock, BigXYZCompany, which currently has a fair market value of $50,000, ten times the $5,000 you paid to purchase it fifteen years ago. The $45,000 represents your capital gains, but if you donate the stock directly to a charity, there's no capital gains tax to pay, and you are still eligible to deduct the full fair-market value of the asset you donated from your income taxes as a charitable deduction, up to the overall amount allowed by the IRS.
Some people may not be interested in donating stock because they think it will require a lot of paperwork and phone calls, or that their chosen charity may not be able to easily accept a stock donation--Most stock brokers can easily handle this transaction for you, and our TD Ameritrade account can accept the donation easily. On our end, we simply provide you at the time with our account name, our account number, and the TD Ameritrade address (TD Ameritrade PO Box 2209 Omaha, NE 68103-2209). Contact us today at 707-978-4149.