Giving with Appreciated Stock

 

Despite the recent volatility in the markets, the Dow had an overall increase of 25% in 2017. Using appreciated stock is another way to support Seton Hall Law while providing the potential for a significant tax benefit. One of the easiest and most effective ways you can support Seton Hall Law in furthering its mission is by making a charitable gift of long-term (held more than one year), publicly traded stock. Often a gift of appreciated securities is a more tax beneficial way to make a gift when compared to cash.

The process is simple. When a gift of long-term appreciated capital gain property is made to a non-profit organization like Seton Hall Law, the charitable deduction is based largely on the full fair market value of the property. There is usually no need for the donor to recognize the capital gain of the appreciation and the capital gain tax is avoided.

For illustration purposes, we will consider a loyal donor who is contemplating making a gift of $10,000 to Seton Hall Law. We will assume that this donor is in the 24% marginal tax bracket for Federal Income taxes (for married joint filers this means an Adjusted Gross Income between $165,001 and $315,000). The first illustration will document a cash gift while the second, a gift of stock.

Cash Gift

  1. $10,000 Cash Contribution
  2. $2,400 Income Tax Saved
  3. $7,600 Cost of Gift to Donor

Gift of Stock

Assume the gift is made with appreciated securities held for more than one year with a cost basis of $2,000.

  1. $10,000 Value of Securities Contributed
  2. $2,400 Income Tax Saved
  3. $1,200 Capital Gains Tax Avoided
  4. $6,400 Cost of Gift to Donor

You can provide the same benefit of support to Seton Hall Law, with a lower cost, by planning and using gifts other than outright cash. There are a number of reasons why making a gift with an appreciated asset can be a wise financial decision. Each vehicle and situation is unique to the donor and their particular goals. We encourage you to contact our team and see if any of our non-cash giving vehicles can help with your personal and altruistic goals. Contact Keith Cook at [email protected] for any non-cash philanthropic options or call us at 973-642-8589.



Office of Alumni Development & External Relations
[email protected] | 973-642-8711