While cash gifts are one of the most common forms of giving, more and more donors at The San Diego Foundation are contributing stock because of the added tax advantages that come with them.
Currently, the federal tax code provides incentives for making charitable gifts of appreciated securities, including public stock. This means that when you donate stock, you are able to make a larger philanthropic impact and enjoy greater tax advantages than simply donating cash or selling the stock and donating the proceeds.
Whether you have a few shares to give or a significant sum, when you contribute stock to a new or existing donor-advised fund at The San Diego Foundation, you can:
Wealth advisor Mark Petrie of Aspiriant, one of the nation’s leading independent wealth management firms, has been helping successful San Diegans achieve their long-term financial goals for years. One of his most recent case studies includes David Engel, a donor-advised fund holder at The San Diego Foundation.
While going through their annual strategic planning and review, Mark and David identified a few publicly-listed stocks with significant unrealized gains held in David’s Family Trust.
Mark recommended donating those assets to his donor-advised fund at The Foundation. That way, instead of selling appreciated shares and owing large sums in capital gains tax, the entire value of his investment return could be utilized for charitable giving and tax deductions.
Once Mark and David agreed on which assets to gift and how much, they worked with The Foundation staff to complete the process.
The Foundation provided David with instructions on how to transfer the assets, along with a gift letter that included an estimated range of the fair market value of the donated stocks. That letter was then used by Mark to calculate the tax deduction David would receive through the transaction. Because the final sale of the stock from The Foundation’s brokerage account can occur a few hours or days after Mark and David execute the transfer, the estimated range of the fair market value ensures the best price for the donor at the time of the decision.
As soon as The Foundation received the transferred stock in its brokerage account, our broker proceeded to find the best price and sell the stock.
Once that process was complete, the amount that the broker sold the stock for was transferred into David’s donor-advised fund, and he immediately had a new pool of money to grant to nonprofit organizations strengthening our community.
For many, the process of gifting a complex asset like public stock can be overwhelming. Our expert advisors have decades of experience working with wealth advisors and philanthropists to identify the best strategy.
If you are considering a gift of public stock, we can connect with you or your wealth advisor to help you accomplish your philanthropic goals.
Note: If you’d like to donate stock before the end of 2019, the deadline for the stock donations to arrive to The San Diego Foundation brokerage accounts is 1:00 p.m., Dec. 20, 2019.
On August 9, 2022, we awarded $838,704 in Opening the Outdoors grants to 24 nonprofit organizations that offer equitable access to outdoor spaces in San Diego County.
“San Diego Foundation is proud to once again support its partners committed to increasing community-driven efforts to enhance accessible outdoor space, encourage youth to learn more through hands-on education and create the next generation of environmental stewards in the San Diego region,” said Christiana DeBenedict, SDF Director of Environment Initiatives.
This year’s grantees will help address these inequities and enhance access to the outdoors throughout San Diego County.
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