Why Give Appreciated Stock?

As 2024 draws to a close, there have been significant gains in investment portfolios. The S&P 500 has reached record highs, creating an excellent opportunity for strategic charitable giving. If you’re holding appreciated stocks, now may be the perfect time to consider establishing a charitable fund at The Foundation for Delaware County – a move that can help you avoid capital gains taxes while supporting the causes and community you care about.

The math is compelling. Make a larger impact by donating long-term appreciated securities, including stock, bonds, and mutual funds, directly to charity. Compared with donating cash or selling your appreciated securities and contributing the after-tax proceeds, you may potentially increase your gift and tax donation. When you donate appreciated stock that you’ve held for more than one year directly to a charity you receive two significant tax benefits:

1. You avoid paying capital gains tax on the appreciation
2. You can claim a charitable deduction for the full fair market value of the stock (for those who itemize on their tax returns).

For example, say you purchased 1,000 shares of stock when shares were priced at $20 each. Since then, the stock price has risen dramatically and appreciated 150%. If you are looking at the stock now, you see the price per share is now $50.

In this scenario, by donating the long-term appreciated stock directly to a public charity like the Foundation, your charitable gift is almost $10,000 more than if you sold the stock and donated after-tax proceeds. In this hypothetical example, it also means you are eligible to deduct almost $10,000 more on your taxes.

Is the Time Right?

Several factors make this a particularly opportune moment to consider this strategy:

• Strong Market Performance: Many stocks have seen substantial appreciation, meaning bigger tax savings when donated
• Year-End Tax Planning: Still time to realize tax benefits for 2024

Next steps

• Contact the Foundation by early December. We can help you select the right type of fund for your charitable goals. Common Fund Types:
• Donor-Advised Funds: Most flexible option, allowing you to recommend grants over time
• Designated Funds: Support specific organizations you care about
• Field of Interest Funds: Focus on causes you’re passionate about
• Unrestricted Funds: Address our community’s most pressing needs
• Contact your broker to process the transfer
• Complete all paperwork well before December 31

Looking Ahead

While tax benefits are attractive, the real power of your charitable fund will be its lasting impact on our community. Your appreciated stock today could seed a charitable fund to provide for the causes you care about long after you are gone.

Why Work with The Foundation for Delaware County?

• Local Expertise: Deep understanding of community needs and opportunities
• Investment Management: Professional oversight of charitable assets
• Grantmaking Support: Help identifying and evaluating nonprofits
• Family Legacy: Ability to involve next generations in giving
• Administrative Ease: We handle all paperwork and reporting

Remember: To complete your stock gift for the 2024 tax year, starting the process early is essential. The transfer must be completed by December 31, 2024. Reach out now to ensure you can take advantage of this timely opportunity.

Contact Monika Collins at mcollins@delcofoundation.org, 610-744-1015.