This article appeared in the August 21, 2024 edition of Newsmax.
In today’s rapidly evolving economic landscape, the importance of giving back to our communities has never been clearer. Many of us are looking for ways to contribute to causes that matter deeply to us, and there’s an incredibly effective way to do so that might not be on your radar.
As we navigate through the second half of 2024, we have an opportunity to not only harness, but to amplify the profound benefits of charitable giving through appreciated stock.
While cash donations are valuable, the strategic donation of appreciated securities held for over a year can exponentially amplify tax benefits. By avoiding long-term capital gains taxes and leveraging the full market value for deductions, the impact is both financially savvy and profoundly altruistic.
For example, let’s break down one example of how just powerful the tax benefits of donating appreciated (or low-cost basis) securities can be:
- The gifting of low-cost basis securities into a donor-advised fund (DAF) platform offers the increased benefit of separating one’s annual tax decisions from the joy of philanthropy.
- A gift of securities into a DAF can be used to make gifts to numerous charitable organizations, over multiple years.
- However, it is important that clients understand how their DAF can have the greatest impact in the communities in which they live.
The Community Foundation for Palm Beach and Martin Counties leads philanthropy locally as a nonprofit organization that leads partnerships with donors, nonprofits and community members to solve the region’s chronic and emerging issues. We provide charitable expertise and vehicles to increase the investment options on behalf of individuals, family foundations, and corporations.
Since 1972, the Community Foundation has distributed over $200 million in grants and scholarships aimed at closing the area’s opportunity gaps. With its vast network of donors and nonprofit partners, we support initiatives that improve youth and education, economic opportunity, thriving communities, and crisis preparation and response.
Setting up a DAF with a Community Foundation offers further benefits including:
- Deep knowledge of the local community and the organizations making an impact
- Individualized philanthropic support from a local philanthropic advisor
- The ability to continue making donations to your favorite causes locally, nationally and internationally
- Donor privacy/anonymity in the public domain (as desired by you)
Imagine you bought $58,000 worth of stock in 2020, and now it’s worth $938,000. If you sold half of it, you’d have to pay around $88,000 in capital gains taxes. But if you donated that stock instead, you could avoid those taxes entirely and get a tax deduction of over $112,000, allowing you to donate even more to your chosen causes.
We invite you to consider how you can maximize your charitable giving while enjoying significant tax savings. If you’d like to explore your options or learn more about setting up a DAF, feel free to contact us directly at mkmorales@cfpbmc.org or 561-340-4508.
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Danita R. DeHaney is the President & CEO of the Community Foundation for Palm Beach and Martin Counties. Since 1972, the foundation has been at the forefront of local philanthropy, distributing over $200 million in grants and scholarships to close opportunity gaps in the community. Learn more at YourCommunityFoundation.org.
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