GIFTS OF STOCK/IRA DISTRIBUTION
Gifts of Stock
Did you know you can make a gift of appreciated stock to The Actors Fund?
Why give stock over cash? If you donate stock that has increased in value since you bought it more than a year ago—and if you itemize deductions—you can take a charitable deduction for the stock’s fair market value on the day you give it away. You’ll also avoid capital-gains taxes on the increase in value over time, which you would have had to pay if you sold the stock then gave the charity the cash proceeds. See table below:
|SCENARIO 1||SCENARIO 2|
|Donate stock||Donate cash|
|Contribute securities directly to The Actors Fund||Sell securities and donate proceeds to The Actors Fund|
|Fair market value of stock||$50,000||$50,000|
|Eliminate capital gains and Medicare surtax||Federal long-term capital gains tax (20%) Medicare surtax (3.8%) paid. Assumes cost basis of $20,000 and long-term gains of $30,000||$0||$7,140|
|Donate more to The Actors Fund||Charitable contribution/charitable deduction||$50,000||$42,860|
|Save more in taxes||Value of charitable deductionless capital gain taxes paid (Assumes donor was in 39.6% federal income tax bracket)||$19,800||$9,833|
|The end result||Give $7,140 more to The Actors Fund and double the tax savings.|
In basic terms: The Actors Fund gets a larger gift, and you get a larger tax-deduction!
CONTRIBUTING FROM AN IRA ACCOUNT
If you are over the age of 70 ½ years old, you can make a contribution to The Actors Fund directly from a qualified IRA account.
What are the benefits? One of the key benefits of the direct charitable contribution from your IRA is that the distribution counts towards your Required Minimum Distribution or RMD (the IRS-determined minimum amount you must withdraw from your account each year). You can contribute more than your RMD to charity as long as you do not exceed $100,000 in a calendar year. It’s money the IRS requires you to withdraw, and by transferring directly to The Actors Fund you won’t be forced to pay income tax.
In basic terms: The Actors Fund gets generous gift, and you lower your tax-liability!