PLANNED GIVING OPTIONS
There are other ways that you can support Sara’s Garden beyond simply donating money. Here are some tips for giving wisely:
Many employers match gifts made by their employees or make grants to organizations recommended by employees. Be sure to ask your company if it can help your gift to stretch even further.
Don’t overlook the benefits you can receive from bequests, charitable gift annuities, gifts in kind, endowments and many other creative forms of giving. Ask your tax advisor or attorney to help create the best plan for you and your family. Our staff is happy to meet with you and your advisor to discuss alternatives.
Below are some additional ways for you to take maximum advantage of today’s tax laws:
Use appreciated securities to enhance your giving
The IRS still allows a notable tax break for individuals considering a charitable gift: Donors may deduct the full, fair market value of long-term appreciated assets given to Sara’s Garden, with no recognition of capital gains. That means that donors can leverage a large donation and charitable deduction using an asset with a small cost basis.
How it works:
A supporter holds publicly traded long-term appreciated stock with a fair market value of $10,000, which they bought for $5,000. If they contribute the stock to Sara’s Garden, they will be able to claim a charitable income tax deduction for the full $10,000. In addition, they will not be liable for tax on the $5,000 capital gains upon the transfer of the stock. By using stock instead of cash, they have delivered $10,000 to Sara’s Garden and secured a tax deduction in the same amount, at a cost to them of only $5,000.
Don’t sell the stock first and then give us the proceeds! Even though you intend to make a charitable gift, the IRS will impose capital gains tax on your sale, wiping out the benefits of this arrangement.
Here’s how to transfer securities: Have your broker contact Sara’s Garden to arrange the transfer to our account. Your charitable deduction will be valued as of the date the securities reach our account. If you hold the shares yourself, mail them, and, in a separate envelope, stock powers in blank, to:
P.O. Box 150
Wauseon, OH 43567
Your charitable deduction will be valued as of the postmark date on your envelope transmitting the securities.
Donors may deduct gifts of appreciated assets up to 30 percent of their adjusted gross income (the total of their taxable income). Thus, a donor whose adjusted gross income will be $100,000 this year will be able to deduct up to $30,000 in gifts of stock. A gift in excess of the 30 percent amount is not wasted, however, because the IRS allows donors to carry forward excess deductions through the five tax years following the year of the gift.
Note that the IRS allows donors of cash gifts to deduct them up to 50 percent of their adjusted gross income, so the deduction for a very large gift of appreciated assets could take longer to use up than if the gift had been made in cash. But if the assets have a very small cost basis, however, they could still be more tax-efficient to use than cash.
If you have any questions, please feel free to call (419) 335-SARA, 9 a.m. to 5 p.m., Monday through Friday.