 ALLISON ABRAMSON PHOTOGiving Appreciated Stock to Charity Can Include Income for You
With several arrangements you can transfer securities now and receive a stream of income for yourself and/or another beneficiary, either for life or a term of years.
If I receive payments, do I still receive tax benefits?
In most instances you are entitled to a charitable deduction for the value of the remainder that will pass to The Community Foundation. This will be less than the face value of the securities but may still be substantial. You also avoid tax on the capital gain just as you would by giving the securities outright. Note: With some gift plans, you will be taxed on part of the appreciation, but only as you receive the payments.
Can a gift of appreciated securities actually increase my spendable income?
Yes. When you transfer appreciated stock for a gift arrangement that provides you with a stream of income for life, all proceeds - because you avoid tax on the capital gain - are preserved to generate those income payments. As a result, your spendable cash may not only be more than you were receiving from the stock but also more than you would receive if you sold the stock and reinvested the proceeds yourself. |
