Donating Stocks, Bonds, and Securities
If you’re looking for a way to help the animals, while also achieving specific tax benefits, donating stocks, bonds, and/or mutual funds might be right for you. Our staff is happy to assist you with any transaction.
Stocks that have appreciated in value can be subject to capital gains tax when sold; however, by transferring your appreciated shares of stock directly to OHS (rather than selling them and remitting the proceeds to OHS), you can avoid all capital gains and resulting taxes. Plus, the IRS allows you to claim, on your itemized Federal income taxes, the full fair market value of the shares (calculated as the average of the high and low prices on the day OHS receives the shares as a charitable gift).
To make a gift of securities, or for more information, please contact:
Senior Manager Major Gifts & Donor Relations
(503) 416-7083 phone
(503) 285-0083 fax
Mr. and Mrs. G decide they would like to immediately make a significant gift to support the Oregon Humane Society and receive a charitable tax deduction as well. Reviewing their portfolio, they note their shares of Intel Corp. have multiplied many times the original, split-adjusted, purchase price of $4 per share. After contacting OHS to arrange the gift and receive transfer instructions, the G’s order their broker to execute a DTC transfer of 100 shares of Intel from their account to OHS’s account.
Here is the outcome:
|Original value of stock||$4 x 100 shares = $400|
|Current value of stock*||$25 x 100 shares = $2,500|
|Capital gains tax liability if stock is sold (rather than donated)||$2,100 ($2,500 current value – $400 original value)|
|Capital gains tax liability if stock is donated to OHS||$0|
|Charitable tax deduction allowed with donation||$2,500 ($25 x 100 shares)|
|Federal tax savings realized with donation**||$750 ($2,500 charitable tax deduction x 30¢)|
|Other possible savings||Will reduce Mr. and Mrs. G’s adjusted gross income subject to Oregon’s state income tax|
*Based on high-low average on the day OHS receives the shares. In this example, on the day the shares were received, Intel traded at a high of $26 and a low of $24, for an average price of $25.
**Assuming Mr. and Mrs. G are in the 30 percent tax bracket.
- Please notify OHS’s Development Office of your intent to make a gift of securities before any transfer occurs. This will help us ensure the appropriate steps are taken and you receive all necessary tax documentation. Additionally, we will provide you with OHS’s account information, which your broker will need to execute the transfer.
- To avoid capital gains tax liability, you must transfer the shares to OHS, as opposed to selling them. Be sure your broker clearly understands your intent. The method most commonly used is called a ‘DTC Transfer’.
- To facilitate such transfers, OHS maintains accounts with many brokerage houses.
- Under-performing stock can also be a good candidate for charitable giving. The capital loss incurred on the sale of such stock can be used to offset your other capital gains. Then, the cash proceeds from the sale can be given as a charitable donation.