The Advantage of Giving Appreciated Securities

“End of the Year” giving is a big deal for all nonprofits. As an example, November and December account for the largest number of payments to our Federation. Right now, we are actually at the “End of the Jewish Year”. The Hebrew month of Elul just began and Rosh Hashana begins three weeks from tonight. I asked our talented Foundation Director, Dan Brandeis, to write today’s message about why thinking about how the Jewish End of Year might be advantageous to community members:

Dan Brandeis
Daniel O. Brandeis, J.D., LL.M.
Jewish Community Foundation Director

While we are still a number of months away from the end of the tax year, it is never too early to start thinking about year-end planning. Given the extraordinary times that we find ourselves in, it may seem remarkable that the financial markets are so strong. For many people, there is a significant advantage to making contributions of appreciated securities to charitable organizations. Not only does it entitle the donor to a full fair market value charitable deduction, but it also allows the donor to avoid capital gains tax on the appreciation.

Should you wish to make a charitable contribution with appreciated securities, you may want to consider establishing a donor advised fund (DAF) in our foundation. A DAF allows you to make a contribution today—with the accompanying tax benefits—while maintaining the right to make distributions as you wish later on. Accordingly, you can make a contribution to create a fund that you can use now and into the future to achieve your charitable objectives.

If the increased standard deduction has caused you to be unable to receive the benefits of a charitable income tax deduction, a DAF may help. The way to do this is by “bunching” a number of years worth of charitable giving into one year. The donor can then make distributions over time as he or she sees fit. In this way, the donor is able to generate enough in charitable giving to exceed the standard deduction and, therefore, take advantage of the charitable income tax deduction.

Funds can be established with a minimum of $5,000. Please reach out to us if you would like more information on how you can establish a donor advised fund at the foundation or if you would like other advice on how to make the most efficient gifts.

Daniel O. Brandeis, J.D., LL.M., Jewish Community Foundation Director

I hope you will give serious consideration to these simple tools that can help you, and in turn, assist nonprofits caring for members of our community. In addition to what Dan shared above, now may be a good time to consider paying your campaign pledge with appreciated securities to avoid the capital gains tax.

You can reach out to either of our two knowledgeable Foundation staff members. Dan Brandeis can be contacted at 412-992-5260 or by email at dbrandeis@jfedpgh.org. Sharon Perelman, Director of Planned Giving & Associate Foundation Director, can be reached at 412-992-5224 or by email at sperelman@jfedpgh.org.

Shabbat Shalom. Wear your mask!

Posted in

Leave a Comment