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As we approach the holidays, many are considering their charitable giving options before the year turns over. Not only leaving but living a legacy is one of the most exciting things a person can do with their wealth. We suggested in a prior blog gifting appreciated stock as a tax planning strategy. We’ll go more in depth on what that means and why you might want to consider it as you plan on making donations.
One of the best ways for investors to give to charity is by donating highly appreciated securities from their portfolio rather than cash. Giving appreciated stock can generate significant tax savings while simultaneously allowing you to contribute to your favorite charities.
Assets that have appreciated in value are among the most tax-advantaged items to contribute to charity because of the potential to eliminate the capital gains tax liability on their sale. You will also be able to enjoy an additional current year tax break if you itemize versus take the standard deduction. This will result in less money going to Uncle Sam and more going to the causes you care about.
Surprisingly, many investors are unaware of the benefits to giving appreciated investments. In several cases, they will sell appreciated securities to donate cash, resulting in a capital gains bill. Most charities can receive stock donations directly, just as they would receive a cash donation. With that in mind, why not give the full fair-market value of an appreciated stock and avoid capital gains? You are giving a higher dollar amount when you donate appreciated stock instead of selling the stock to give cash.
Take a look . . .
Is charitable-giving a part of your overall wealth management plan? Giving appreciated stock can be an effective and tax-efficient way to support a charity. Let the Burney Wealth Management team help you develop and implement a year-end charitable-giving strategy that is beneficial to you and your charities. That allows you to be impactful to the causes that are important to you while enjoying tax advantages of charitable giving.
The Burney Company is an SEC-registered investment adviser. Burney Wealth Management is a division of the Burney Company. Registration with the SEC or any state securities authority does not imply that Burney Company or any of its principals or employees possesses a particular level of skill or training in the investment advisory business or any other business. Burney Company does not provide legal, tax, or accounting advice, but offers it through third parties. Before making any financial decisions, clients should consult their legal and/or tax advisors.
