[Video] Donating Appreciated Stock
by Stephen Smalenberger, EA / December 10, 2017STEPHEN SMALENBERGER, EA
Maybe you’re considering a way to support a not-for-profit organization that you believe in. Here’s a way to do just that with something that you already own… appreciated stock.
What is appreciated stock? It is an investment that has grown since you bought it.
Let’s use an example and use some number in order to make it more visual.
Maybe you bought a certain stock years ago for $1,000 and over time it has increased in value and is now worth $11,000. If you were to sell this investment, you would recognize a long-term capital gain of $10,000.
Is it possible for you to provide financial support and do so in way that benefits both you and the organization?
Yes, here’s one way to do just that.
Instead of giving cash or first selling the investment and then giving the proceeds, it would be most beneficial to donate the stock directly to the organization. This method would still provide you with the tax deduction for the fair market value of the investment but also help you avoid recognizing capital gains from the sale.
While this is not for everyone, for those situations when it does make sense… it can be a win win.
If you are considering this before year-end, it is best to ask custodian and the organization what procedures are required and the timeframe in which to complete the donation.
View Next
Ready to take the next step?
Schedule a quick call with our financial advisors.
Recommended Reading
Meet the Chief Investment Officer [Video]
Hear our Chief Investment Officer, Rob, share how sitcoms and meteorology led him to investment management, and later FDS!
Meet the COO of Financial Design Studio [Video]
Meet the COO of our business! In this video, Trevore shares how he came to Chicago, why he started his own firm, and how he cares for people.
Stephen Smalenberger, EA
Steve enjoys getting to know clients and hear their unique stories and the lessons learned which has brought them where they are today. One of the reasons he enjoys what he does is the ability to show the outcome that can be achieved with different choices. He also enjoys continually learning.