Options to Give Giving Appreciated Securities

Giving Appreciated Securities

The Missouri United Methodist Foundation can assist you in making your gift to any United Methodist church, organization or affiliated institution. This service of the Foundation is intended to assist those United Methodist charities that do not have the ability to readily receive and process gifts of securities.

The Foundation receives the security, sells it and sends the cash proceeds to your designated church or United Methodist charity.

 A Wise Way to Give

The tax-saving advantages achieved by donating appreciated securities, allows many United Methodists to realize they can be more generous to their local church or United Methodist organizations than they could be with an after-tax gift of cash.

Stock Gift Transfer Form and Instructions

When you donate appreciated securities to your Church or United Methodist Charity:

  1. You incur no capital gains tax. (That’s your “extra” tax savings!)
  2. The Foundation incurs no capital gains tax when it sells the securities.
  3. You can deduct the fair market value of the securities as of the date of your gift. The income tax deduction may be taken for up to 30% of your adjusted gross income, or up to 50% if you elect to limit your deduction to your basis on your tax return. Any unused deductions may be carried forward and used for as many as five additional years.

Gifts of Mutual Funds

Mutual fund shares that have appreciated in value are an excellent charitable gift with tax advantages similar to those of other appreciated securities. In many cases, mutual fund shares held in a brokerage account may be transferred directly to the Foundation’s brokerage account. However, mutual funds held directly with the mutual fund company may need special handling. Please notify our office of your intent to make such a gift.


Timely Consideration

Consider a gift of appreciated securities whenever you prefer not to incur capital gains tax, such as in these circumstances:

When you wish to upgrade your portfolio.

Donate appreciated, low-dividend stock. Use your cash to buy stocks that pay higher dividends.

When you wish to increase your cost basis in a stock you intend to hold.

Give your low-basis securities instead of cash and use your cash to purchase more of the same stock at current prices, thereby increasing your cost basis without incurring any capital gains tax.

When you want a higher yield.

Create a Foundation Charitable Gift Annuity or Charitable Remainder Trust with low yield, highly appreciated securities. Your capital gain liability is either greatly reduced or eliminated, and you and/or another beneficiary receive annual income, frequently at a higher rate of return. You also get an immediate income tax deduction.

Other Important Considerations

  1. For appreciated securities that you have held for less than one year and one day, only your cost basis is deductible.
  2. It is usually more advantageous for you to sell stock that has decreased in value, claim the loss on your tax return, and contribute the
        cash proceeds.

Ask Monett

Contact Monett Lite for answers to your giving securities questions.