The Benefits of Charitable Giving with Stock
If you are like most individuals, the value of your stock and other investments has grown over the years. Perhaps you are entering your retirement years and wondering how you can turn your highly appreciated asset into extra income.
You may also be concerned about the mounting capital gains taxes due. If you sell your stock in today's market, you will forfeit a portion of the proceeds to taxes and that means less cash for you. In short, you need a way to sell your stock and avoid capital gains.
If you identify with any of these situations, the solution is a charitable stock plan. A variety of charitable plans can help you achieve your goals for tax savings and even provide income.
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Outright Gifts of Stock
Two charitable stock plans may help avoid income or estate tax.
Current Stock Gift
By transferring your stock to your Boys & Girls Club today, you can enjoy the benefits of tax savings on this year's return. In addition to your charitable deduction, you will avoid paying capital gains tax that would otherwise be due on the sale of your appreciated investment.
Stock Bequest
If you are still enjoying the benefits of holding your appreciated stock but looking for a way to avoid estate tax in the future, a stock bequest is a good choice. In your will or trust you may wish to include instructions for transferring your stock to the Club. Your estate will benefit from a charitable deduction that will lessen the impact of taxes on your estate and your heirs.
Gifts of Stock For Life Income
These charitable stock plans may provide you tax savings and income for retirement.
Gift Annuity for Stock
You may transfer your stock to fund a charitable gift annuity that will partially bypass capital gains tax and pay you fixed income for life. The rates can be quite high depending on your age and a part of your income stream may even be tax free! You will receive an income tax deduction for your gift in the year you set up the annuity. At the end of your life, you have the satisfaction of knowing the remaining value is going to help the youth in our community.
Unitrust and Sale of Stock
By giving your stock to fund a unitrust you can avoid capital gains tax because the trust will sell your stock tax free and then invest the proceeds to provide you with income for life. You will receive a charitable income tax deduction in the year the trust is established and benefit from tax savings that could be spread out over a number of years. Your Boys & Girls Club will benefit from the future remaining trust value.
This information is not intended as tax, legal, or financial advice. Gift results may vary. Consult your personal financial advisor for information specific to your situation
