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Your path to this gift:
You're considering an outright gift made during your lifetime > You're holding stocks that have risen in value > You want to maximize your deduction but not affect your cash flow
The IRS still offers you a notable tax break for charitable gifts: you may deduct the full, fair market value of appreciated assets that you give us, and also avoid capital gains liability on the transfer. This means that you can leverage a larger donation if you use an appreciated asset to make your gift instead of cash.
The most common appreciated asset, and the easiest to donate, is marketable stocks and bonds. Here are some details about these gifts:
- How will your gift of stock be valued? It's the average of the high and low prices for the stock on the date of the transfer to us. If the high bid was $80 and the low was $70 on the day you made your gift, your deduction will be $75 per share.
- When is your gift complete? If your stock is held by your broker, it's the date the shares reach our account. If you hold the stock yourself and mail it to us, it's the postmark date on the envelope.
- How should you transfer securities to us? If your broker holds the shares, he or she should call our office at 203-625-5864 for transfer instructions. If you hold the shares yourself, mail them unendorsed, and in a separate envelope mail a stock power signed in blank for each stock certificate to:
Brunswick School
100 Maher Avenue
Greenwich , CT 06830
203-625-5864 | Fax: 203-625-5863
E-mail: tgumz@brunswickschool.org
- Can you deduct the full amount of your gift? Yes, within this limitation: the IRS says that you can deduct gifts of appreciated assets up to 30 percent of your adjusted gross income ("AGI" -- the figure at the bottom of the first page of Form 1040. See glossary for full definition). Thus, if your AGI will be $100,000 this year, you will be able to deduct up to $30,000 in gifts of stock. A gift in excess of the 30 percent amount is not wasted, however, because the IRS allows you to carry forward excess deductions through the five tax years following the year of your gift.
Note that the IRS allows cash gifts to be deducted up to 50 percent of adjusted gross income. Therefore, the deduction for a large gift of appreciated assets could take longer to claim than the deduction for the same gift made in cash. But if the donated assets had a small cost basis, they could still be more tax-efficient to use than cash.
If you are considering a gift of appreciated securities, email us, complete the personal illustration form, or call us at 203-625-5864 so that we can assist you through every step of the process.
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