While the vast majority of all charitable donations nationwide are made in cash, there are other options for giving that may be far more advantageous tax-wise, and a better fit for your particular situation. Consider these possibilities:
- Stocks: Equities may be transferred directly to a brokerage account for the Parsons Area Community Foundation. A charitable tax deduction is allowed for the average price of those equities on the day of transfer, if the stock has been owned for more than one year. Any capital gains on the stock remain tax-free However, if the stock has been owned less than a year, your deduction will be limited to cost rather than current market value. Upon receipt, the stock will be sold and added to the fund(s) of your choice. For wiring instructions, click here.
- Retirement plan assets: Through the beneficial designation form of your retirement plan all, or a percentage of the total assets, may be assigned to the community foundation. You may indicate the way you wish those funds to be distributed or used by the community foundation. Depending on your financial situation, this may provide substantial estate tax savings.
- Real estate: Gifts of land, a primary residence, rental property, vacation home or farm may be made outright or placed in a charitable trust with life tenancy. An outright gift of real estate to a public charity allows you to deduct the property’s fair market value (FMV) while avoiding capital gains tax. If creation of a charitable trust or gift annuity is of interest, the community foundation can provide options for you to review with your financial planner.
- Life Insurance: This option may allow you to make a larger gift than ever dreamed. Paid up policies allow a gift with no out of pocket expense. An excellent article detailing all the ins and outs of life insurance gifts may be found here: http://www.pgdc.com/pgdc/charitable-gifts-life-insurance
- Tangible Personal Property: The most common types of tangible personal property contributed to charity include: artwork, jewelry, gems, and other collectibles; motor vehicles, watercraft, and aircraft; livestock, harvested crops, cut timber, and other agricultural products; as well as items of business inventory or equipment. The community foundation has a gift acceptance policy requiring a board review of any proposed personal property gift. Please consult both your accountant or attorney and the community foundation prior to making this type gift. Further information may be found at http://www.pgdc.com/pgdc/tangible-personal-property
- Closely held stock: Every situation is different, so legal counsel should be involved before this gift is initiated. Whether the stock can be given legally and whether there is a buyer for the stock are key questions to explore when considering this gift.