Many generous supporters don’t realize that one of the most tax-efficient ways to support Finding Kids is by donating appreciated stocks, mutual funds, or other publicly traded securities.
If you’ve owned investments that have increased in value, a stock donation may allow you to make a larger charitable impact while potentially significantly reducing your tax burden.Avoid Capital Gains Tax
When you sell appreciated stock, you may owe capital gains tax on the increase in value. By donating the stock directly to a qualified nonprofit like Finding Kids, you can avoid paying capital gains tax on the appreciation. It’s generally not a good idea to sell stock and then donate the proceeds to your favorite charity because you will need to pay tax on the gains.
Receive a Charitable Tax Deduction
If you have owned the securities for more than one year and itemize deductions, you may claim a charitable income tax deduction equal to the fair market value of the donated securities (based on the market price on the day you donate them), subject to applicable IRS limitations. For a stock you purchased ten years ago for $50 that is now worth $500, you’ll be able to write off $500 (versus paying capital gains tax on the $495 gain if you sell it).
Make a Greater Impact
Because you may avoid capital gains tax, the amount that would otherwise have gone toward taxes can instead support the mission of Finding Kids – helping to recover missing and exploited children, provide trauma-informed care, and bringing child predators to justice.
Preserve Your Cash
Rather than writing a check, donating appreciated investments allows you to support a cause you care about while preserving cash for other financial goals.
Example: How a Gift of Appreciated Stock Can Increase Your Impact.
Imagine you purchased stock several years ago for $20,000. Today, it is worth $100,000, and you would like to make a charitable gift to Finding Kids.
If you sell the stock first, you will likely owe capital gains tax on the $80,000 appreciation. Assuming a combined federal and state capital gains tax rate of approximately 30%, you could owe about $24,000 in taxes.* After paying those taxes, approximately $76,000 would remain available for charitable giving.
If you donate the stock directly to Finding Kids, you will avoid paying capital gains tax on the appreciation. If you’ve owned the stock for more than one year and meet applicable IRS requirements, you may be eligible for a charitable income tax deduction equal to the stock’s fair market value.* Finding Kids will receive the full $100,000 value of your gift, allowing more of your investment to help recover missing and exploited children, provide trauma-informed aftercare, and bring child predators to justice.
In this example, donating appreciated stock instead of selling it first could allow an additional $24,000 to support Finding Kids’ mission rather than being paid in capital gains taxes.
Donating Stock Is Easy
Finding Kids accepts gifts of publicly traded securities. Our team can provide simple transfer instructions and work directly with you or your financial advisor to ensure your gift is completed efficiently.If you would like to make a gift of appreciated securities or learn more, please contact us at info@findingkids.org. We would be honored to assist you through the process.
*This example is for illustrative purposes only. Actual tax savings will vary based on your individual circumstances, including your income, state of residence, and applicable tax laws. Please consult your financial advisor or tax professional before making a charitable gift.
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