Accounting for Stock Gifts for your Not-For-Profit Blue & Co , LLC

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• Once users submit this form, they’ll receive custom instructions for initiating a gift with their broker and the organization’s DTC information.
• Supporters who prefer to give stocks may do so at a different time of the year than those who give large gifts.
• Donors that have stock with a fair market value of at least $500 are eligible to donate stock via Donorbox’s integration with The Giving Block.
• Here’s a guide to how you can donate stocks and reap tax rewards for your generosity.
• You will also be asked to provide a secondary signer and acknowledge board approval.

Grab Your Seat in the FREE Training on How to Accept Gifts of Stocks!

Business entities using a Corporate Giving Account may have different tax considerations. Please contact your tax advisor to determine your tax deductibility limits. Use this calculator when considering donating your long-term publicly traded stock, or consult a professional advisor. 1Total Cost Basis of Shares is the amount of money you have invested in the shares of a particular fund or individual security. It represents the basic dollar amount that, when compared to the price at which you sell your shares, tells you how much of a capital gain or loss you have realized. With this information, we’ll quickly verify your 501(c)(3) status and activate your account.

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First and foremost, the benefits and tax savings of donating stock frequently encourage donors to give what would be considered major gifts, perhaps for the first time. Gifts of stock are usually quite larger than cash Food Truck Accounting gifts, and they represent a huge pool of potential donation revenue—the US Census estimates that 97-99% of wealth is held in non-cash assets. ‍Plus, if your nonprofit prefers to immediately liquidate stock gifts (recommended to ensure maximum value), their impact will be delayed and their accounting will be complex. You’ll need to direct your broker to liquidate received gifts, potentially pay fees, and then wait for the net cash proceeds to transfer.

Acknowledging the Stock Gift

You’ll need to send this information to your broker to initiate the transfer. When donors start giving stock to your nonprofit, ask for feedback on their giving experience. Consider sending a short survey that asks why they decided to give stock, unearned revenue how easy the process was, and what you can do to improve their experience.

What are the benefits of donating stock for donors?

• Please contact a member of the Hawkins Ash CPAs nonprofit team if you have any questions or need assistance regarding stock donations.
• After receiving a stock donation, the final step is to send the donor a tax receipt that complies with IRS requirements.
• The next option is to go straight to the organization’s transfer information.
• Plus, they’ll give you general guidance on nonprofit investing best practices, in case you decide to reinvest any of your stock donations.
• At one point, your nonprofit will see an influx of donations, and at another point, you’ll see a dip.

First, donating stock allows donors to avoid both capital gains and state income taxes that they would otherwise need to pay if they instead sold the stock to donate cash. Additionally, donors can claim a charitable deduction for how to accept stock donations the current fair market value of their stock at the time of donation. Together, these benefits can represent significant tax savings for donors.