Stocks & Bonds
Make a gift of publicly-traded securities to Christian Camps and Conferences, Inc. and potentially save income tax and capital gains tax, too.
A Gift of Publicly-Traded Securities Could Be Right for You If:
- You own publicly-traded securities that you have owned for at least one year.
- The securities you own have increased in value since you bought them.
- Some of these securities will not yield the expected income amounts.
- Currently, a non-cash gift to support the mission of Christian Camps and Conferences, Inc. would fit your desires and financial situation.
How it Works
Stock and security transfers are generally accomplished through electronic transfer. Contact your broker to initiate the transfer and provide them with the following information:
Account Title : Christian Camps and Conferences, Inc.
Receiving Firm: National Financial Services LLC, Covington, KY
Account Number: SMX-000355
- Please notify the main office by phone at 603-875-3600 or email to let us know the transfer is coming as your name will not be included in any notification of the transfer.
- As soon as CCCI receives notification of the receipt of the transfer, the securities will be sold immediately in accordance with our policies.
- The donor will receive a written acknowledgement of the donation from CCCI with the amount and type of shares received.
- The donor can claim a tax deduction for the fair market value of the gift on the day of its transfer to the organization.*
*Please Note: To receive tax benefits in 2019, any security transfers should be initiated early enough (usually a week in advance) to insure the transfer is complete by Dec 31st.
What are publicly-traded securities?
Publicly-traded securities are stocks, bonds, and other investment vehicles whose values are readily available from an established securities market. For example, stocks listed on the New York Stock Exchange or NASDAQ are publicly-traded securities.
Are mutual fund shares publicly-traded securities?
Tax benefits of contributing publicly-traded securities
You can save income tax and capital gains tax when you give shares of a publicly-traded security that you have owned for a year or more.
Income tax benefit
If you have held your securities for more than one year, and provided you itemize, you may deduct from your taxable income the full fair market value of your shares as of the date of your donation, regardless of what you paid for them. Your deduction is limited to 30% of your adjusted gross income. You may, however, carry forward any unused portion of your deduction for up to five additional years
Capital gains tax benefit
When you donate publicly-traded securities that have increased in value, and you have owned the securities for more than one year, you do not have to report any of your capital gain on the securities. If you were to sell these securities yourself, you would owe capital gains tax on the difference between the sale price and the amount you paid for them.
Should I give my securities or sell them and give the proceeds?
You should give your securities directly to Christian Camps and Conferences, Inc. if you have held them for more than one year and they have appreciated in value. This way, you will avoid paying tax on any capital gain you have in your securities. If you sell your securities first and then give us the proceeds, you will have to pay capital gains tax on all of your capital gain, an unnecessary and potentially substantial cost to you.
Cash Gift vs. Stock Gift:
|Cash Gift||Stock Gift|
|a. Gift value||$10,000||$10,000|
|b. Income tax deduction||$10,000||$10,000|
|c. Income tax saved (at 37% rate)*||$3,700||$3,700|
|d. Purchase price||N/A||$1,000|
|e. Increase in value (a – d)||N/A||$9,000|
|f. Tax avoided on gain (at 20% rate)||N/A||$1,800|
|g. Total tax savings (c + f)*||$3,700||$5,500|
*assumes donor itemized deductions
What is the advantage of giving appreciated stock instead of cash?
When you make a charitable gift of cash, you get an income tax charitable deduction only. When you make a charitable gift of the same value with appreciated stock, you get the same income tax charitable deduction and you avoid capital gains tax on all of your capital gain. The more highly appreciated your security, the more capital gains tax you will avoid.
The chart below shows how making a gift with appreciated stock can save substantially more taxes than making the same size gift with cash.
Should I make a gift of securities that have lost value?
What happens if I give securities that I bought less than one year ago?
The charitable deduction available for property you have owned for 12 months or less, so-called “short-term capital gain” property, is limited to either its current full value or what you paid for it, whichever is less. For example, if you give stock worth $10,000 that you purchased nine months ago for $1,000, your charitable deduction will be $1,000, not $10,000.
When you give short term gain property, your deduction is limited to 60% of your adjusted gross income rather than the usual 30%.
Is it easy to make a gift of publicly-traded securities?
Give securities and receive payments for life
Another option for giving securities is through a life income plan. Giving securities through a life income plan such as a charitable gift annuity, charitable remainder trust, or pooled income fund allows you to provide income for yourself or others you care about and then provide support to CCCI. Here’s how it works:
- You transfer securities to the life income plan.
- A gift of appreciated securities to a charitable gift annuity, charitable remainder trust, or pooled income fund will typically defer or in some cases completely avoid capital gain from your gift of securities.
- During the term of the life income plan, you receive payments from the plan each year, typically for life.
- When the life income plan ends, its remaining principal goes to support CCCI.
Using securities to fund a life income plan typically will reduce your income taxes, providing tax savings if you itemize, and reduce or eliminate your capital gains taxes.
There are several life-income plan options to choose from. The one that is right for you will depend on a variety of factors. Please let us know if you would like to learn more.
Malcolm Howell would like to make a $10,000 gift to Christian Camps and Conferences, Inc. While he could write a check for this amount, he will be able to save even more in taxes by giving stock worth $10,000 instead. After reviewing his plans with his investment advisor, he decides to give shares of Poptropica Corporation worth $10,000. He paid just $1,000 for these shares when he bought them 20 years ago.
- Malcom will earn an immediate income tax charitable deduction of $10,000, which will save him $3,700 (37% tax), provided he itemizes.
- Malcom may deduct up to 30% of his adjusted gross income in the year of the gift, with a five year carry-forward period.
- He will avoid tax on $9,000 of capital gain, which will save him an additional $1,800 (20% tax).
- He will gain the satisfaction of making a $10,000 gift to Christian Camps and Conferences, Inc.