Why Giving Stock Instead of Cash Could Be a Smart Tax Strategy

When you think about charitable giving, cash donations are usually the first thing that comes to mind. But there’s another option that can be more tax-efficient and just as impactful: donating stock. Here’s why this strategy is worth considering:

Give More

By donating stock you’ve held for more than a year, you avoid paying capital gains tax (up to 23.9% Federal) and can still deduct the full fair market value as a charitable contribution. This means your gift can go further without costing you more.

Support Multiple Charities at Once

A single stock gift (especially through a donor-advised fund) can be split into grants for several organizations over time.

Reduce Future Taxes

If you own a stock that’s grown in value, consider donating some shares and repurchasing them at today’s price. This resets your cost basis, reducing potential capital gains when you sell in the future.

Rebalance Your Portfolio

If a single stock has become a large portion of your portfolio, donating shares can help you diversify while supporting a cause you care about.

Keep It Simple

Using a donor-advised fund allows you to make one stock donation, take one tax deduction, and then recommend grants to charities over time—without multiple transactions or extra paperwork.

Preserve Your Cash Flow

Stock donations allow you to make a meaningful contribution without reducing your available cash or emergency savings.

Benefit Your Estate Plan

Donating appreciated assets during your lifetime can reduce the size of your taxable estate, potentially lowering estate taxes.

Maximize Your Tax Strategy

Pair stock donations with other giving strategies, such as “bunching” multiple years’ donations into one year, to exceed the standard deduction and maximize tax savings.

Contact BNA Today

If you’re a business owner looking for reliable financial guidance, we’re just a call away. Reach out to us at (803) 366-8371 or email us at success@bna.com to see how we can support your goals.

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