Donating appreciated securities – such as stock or mutual funds – to Cincinnati Therapeutic Riding and Horsemanship is a tax-wise approach to spark hope through inclusive horsemanship. Many donors choose to give gifts to CTRH using long-term appreciated stocks and mutual funds due to the attractive tax advantages associated with such gifts.
The benefits available to you when making a charitable contribution of stock or mutual funds may include:
– Avoiding federal and state tax on the capital gain;
– Receiving an income tax deduction (federal and most states) for the full market value of the gift if you itemize deductions on your tax return and have held the assets one year or longer;
– Making a larger gift at a lower original cost to you.
Important facts to remember:
– You must itemize your tax return in order to deduct a charitable donation.
– You must have owned the securities for at least one year before donating them or you will be limited to a deduction of your original purchase cost of the securities.
– You may take a deduction valued up to 30% of your adjusted gross income. If the deduction is greater than 30%, you may carry any unused deduction forward for up to five years into the future until it has been fully used.
– We encourage you to consult your financial planner or tax advisor who can assist you in evaluating the tax advantages available to you when making a donation of appreciated securities.
Is this a good option for you? A gift of appreciated securities is for you if…
– You’re holding stocks, bonds, or mutual fund shares that have increased in value.
– You want to make a gift that doesn’t affect your liquidity or cash flow.
– You want to make an outright gift, or fund a gift that will first return lifetime payments to you and/or another beneficiary.
– You want to diversify your assets to increase your income without having to pay the capital gains taxes that would result from a sale.
Cincinnati Therapeutic Riding and Horsemanship prefers to receive undesignated gifts, allowing for the greatest flexibility in responding to evolving needs and priorities, but will also accept gifts designated to a specific purpose. Please contact us if you choose to designate your gift as changes in political situations or program capabilities may affect our ability to honor you request.
For more information, contact:
Transfer your securities by DTC through your broker:
To learn how to easily transfer your securities to CTRH by DTC, please click here for instructions.
Securities held in certificate form:
If your securities are held in certificate form, please contact us for specific instructions on transferring your stock to Cincinnati Therapeutic Riding and Horsemanship.
Other ways to give securities:
Appreciated securities may also be used to fund gift plans that provide payments for life or a number of years, such as charitable gift annuities or charitable remainder trusts.
An Example of How Gifting Stock Works *
A $5,000 cash gift and a gift of $5,000 in appreciated securities both generate the same charitable deduction.
But if you use publicly traded stocks, bonds, or mutual fund shares that you have held for a year or longer to make your gift, you will receive an additional tax benefit: The IRS allows you to make your transfer to Cincinnati Therapeutic Riding and Horsemanship without recognizing capital gains on the appreciation. You can thus leverage a larger donation than you could make with cash — and receive a larger tax benefit — by “buying low and giving high.”
Your gift of stock is valued, for tax purposes, at the mean of the high and low on the date the shares are received in our account. Mutual funds are valued at the “net asset value.”
If you and your advisors are transferring assets at the end of the year, it is especially important to note the following:
– For stocks transferred through the U.S. Post Office, the gift date may be found in the postmark. (Stock certificates should be sent unsigned to Museum Center with an executed stock power mailed under separate cover on the same day.)
– Gifts delivered by UPS, Fedex, or any other delivery company are credited, by law, on the day received by Museum Center.
Important Tip: Don’t sell the stock first. Even though you may give us the proceeds as a gift, the IRS will impose capital gains tax on your sale, wiping out the benefits of this arrangement.
|Sell $5,000 in Securities and
Donate Cash Proceeds
|Donate $5,000 Cash||Donate $5,000 in Securities|
|Federal Capital Gains Tax Paid||$525||$0||$0|
|State Capital Gains Tax Paid||$175||$0||$0|
|Total Tax Paid||$700||$0||$0|
|Federal Capital Gains Tax Saved||$0||$0||$525|
|State Capital Gains Tax Saved||$0||$0||$175|
|Federal Income Tax Saved||$1,204||$1,400||$1,400|
|State Income Tax Saved||$215||$250||$250|
|Total Tax Saved||$1,419||$1,650||$2,350|
|After-tax “Cost” of a $5,000 Donation||$3,581||$3,350||$2,650|
* More than 80 percent of the 50 states levy a tax on capital gains that can be as high as 12 percent.
* The information in this material is not intended as tax or legal advice. It may not be used for the purpose of avoiding any federal tax penalties or liabilities. Please consult legal or tax professionals for specific information regarding your individual situation.