Gifting Appreciated Securities to Maximize Benefits for All
For investors with appreciated securities in their portfolio, donating assets directly to charitable organizations such as the END Fund can create a win-win scenario that maximizes both philanthropic impact and tax benefits.
Compared with donating cash or selling appreciated securities and contributing the after-tax proceeds, donating stocks and appreciated securities directly can increase the impact of your gift while simplifying and aligning with individuals’ philanthropic financial planning. Doing so proves to be one of the most effective ways of making a difference to the causes you support.
The END Fund works with donors seeking to maximize their impact and advisors seeking to guide their clients on optimizing their philanthropic giving to make the most of this opportunity.
WHY DONATE APPRECIATED SECURITIES?
When you contribute long-term appreciated assets directly to a nonprofit, you can:
- Avoid capital gains tax on the appreciation of your securities, enabling you to direct those funds to a cause you care about.
- Receive a charitable deduction for the full fair market value (if held more than one year).
- Make a larger gift at no additional cost to you, increasing the number of people you can support to live free from NTDs.
- Simplify your philanthropic planning by transferring assets directly to the END Fund.
Gifting the securities themselves means the full proceeds of the sale will support NTD elimination efforts, and you could eliminate capital gains exposure. This win-win means you’re supporting more communities affected by these preventable diseases for no additional cost. Consider this potential savings example:
| Original cost of securities: $25,000 Federal long-term capital gains rate: 23.8%1 Value of securities: $40,000 | Selling securities and donating the proceeds | Donating securities directly to the END Fund |
|---|---|---|
| Capital gains and Medicare surtax paid on $15,000 (23.8%) | -$3,570 | $0 |
| Total contribution to charity (after deducing federal taxes) | $36,430 | $40,000 |
Additional amount
donated +$3,570
Several strategies present an opportunity to maximize the benefits for both affected communities and donors prior to December 31:
- Give Publicly Traded Securities: transferring assets directly to the END Fund allows you to deduct their full market value and avoid capital gains tax.
- Funding a Donor-Advised Fund (DAF) with Securities: providing a gift of stock to your DAF provides an opportunity to receive an immediate deduction and enables you to direct grants to philanthropic organizations such as the END Fund throughout the year.
- Maximize Your Impact This Year with Excess Contributions: if your donations exceed deduction limits for any given year, you can apply the excess amount as a deduction against your AGI in a future tax year, enabling you to maximize your impact today and retain the benefits.
- Gift Restricted or Private Company Stock: we can assist with the valuation and transfer of closely held securities, enabling you to leverage unique assets that have appreciated over time for maximum impact.
You can gift appreciated securities to the END Fund utilizing the following details:
| Bank Name | Citizens |
| Account Type | Corporation |
| Account number | J9K000042 |
| DTC Number | 0226 |
| Account Name | THE END FUND INC |
If you wish to discuss this topic further, please contact Bryon Earl via [email protected].
1You are responsible for paying long-term capital gains tax on the profit (the difference between the sale price and your purchase price). The rate is 0%, 15%, or 20% depending on your income, plus a potential 3.8% Net Investment Income Tax.
*You should always consult with your financial advisor before initiating a charitable gift arrangement. The information provided is for informational purposes only and should not be considered as financial, tax, or investment advice. Always consult with a qualified financial advisor or tax professional before making any financial decisions or charitable donations. The END Fund does not provide tax advice and recommends that donors consult with their own advisors to understand the tax implications of their donations.