Donating stock is a wonderful way to help MAYAN FAMILIES fund programs to end poverty and suffering. Whether your portfolio performance was above market averages or even if you had a decline in your portfolio value, donating stock to MAYAN FAMILIES is a wise investment in breaking the cycle of poverty.
Save Children, Women and Families—With Appreciated Stock:
If you have stock that you have owned for more than one year and it has appreciated since you purchased it, you can save on the capital gains tax you would owe if you sold it yourself by donating the stock to MAYAN FAMILIES. And since MAYAN FAMILIES is a 501(c)(3) charitable organization, you will be entitled to an income tax deduction for the full current market value of your gift, to the extent allowed by law.
Here is an example: Ms. I. Am Amazing purchased 100 shares of XYZ stock three years ago at $50 per share, or $5,000. This stock is now worth $100 per share, or $10,000. If Ms. Amazing sells the stock, she will pay capital gains taxes on the $5,000 of appreciation. If Ms. Amazing donates the stock to MAYAN FAMILIES, she is entitled to a charitable deduction of $10,000 from her taxes and pays no capital gains tax.
You can also deduct stock donations equal to an amount of up to 30 percent of your adjusted gross income, and any excess deductible amount can be carried over for as long as five years to offset income or capital gains taxes.
How to protect Impoverished Children, Women, Families, Orphans, the Elderly—and Your Investment Portfolio:
Another option for using your "long-term" appreciated stock to fight poverty is to donate the stock to MAYAN FAMILIES and either repurchase the shares on the market or diversify your assets by purchasing securities of an equal value in different sectors and industries. Not only will you be able to claim a charitable deduction for the fair market value of your gift, you will also minimize any capital gains tax when you eventually sell the replacement shares.
Here is an example: Ms. I. Am. Amazing purchased 1,000 shares of GGG stock three years ago for $3,000. The stock has a current value of $44,000. She donates the 1,000 shares to MAYAN FAMILIES and is thereby able to claim a charitable deduction for the fair market value of $44,000 while avoiding capital gains taxes on the profit of $41,000.
Ms. Amazing then buys 1,000 shares of GGG stock for $44,000. If, after holding the replacement shares for more than one year, Ms. Amazing decides to sell out and the shares are then worth $50,000, she will pay capital gains taxes on only the $6,000 of profit garnered by the replacement shares, rather than the $47,000 of profit that she has made overall on the GGG stock. The other $41,000 of profit is never taxed.
How to Turn a Stock Market Loss Into a Win:
If you took a loss in the stock market, you can still help MAYAN FAMILIES campaigns against poverty! By selling stock at a loss and then making a donation to MAYAN FAMILIES of the same amount of money that the stock was sold for, you can do the following:
You can claim a charitable deduction for the gift.
You can deduct the stock's decrease in value from your other income, thereby reducing the taxes you pay.
You can deduct up to $3,000 ($1,500 if you are married filing separately), but any amount of loss above that can be carried over to future years until completely deducted.
Here's an example: Ms. I. Am Amazing purchased 100 shares of ABC stock three years ago at $50 per share or $5,000, but it's now worth only $20 per share, or $2,000. Ms. Amazing doesn't expect the value of the stock to go up anytime soon. If Ms. Amazing were to donate the depreciated stock to MAYAN FAMILIES, she could claim a $2,000 deduction. But if Ms. Amazing sells the stock and donates the $2,000 value to MAYAN FAMILIES, she can also claim a $3,000 capital loss deduction ($30 loss per share times 100 shares). Assuming that she has no capital gains, she would be able to deduct the $3,000 from her income ($1,500 if she is married and filing separately, and carry over the remaining $1,500 capital loss to deduct from income or capital gains in future years).
For More Information:
As always, we suggest that you consult with your independent financial, tax, and legal advisor for specific help with your particular situation, as the above is intended as an introductory outline only and MAYAN FAMILIES does not provide financial, tax, or legal advice. But if you would like more information about the various ways in which your stock holdings can be used before year’s end to benefit impoverished children and families in rural Guatemala—and yourself—please email us at firstname.lastname@example.org
or call us at 619-550-2608.