Donating Securities

Donating securities to the South Kingstown Land Trust is a smart and simple way to help protect open space.

You can make a gift of appreciated securities—publicly traded stocks, bonds and mutual fund shares—to the South Kingstown Land Trust (SKLT) while avoiding capital gains tax and diversifying your portfolio.

HOW IT WORKS

  1. You transfer appreciated securities to SKLT.
  2. SKLT sells the securities and uses the full proceeds to fund critical conservation work.  As SKLT is a tax-exempt charity, capital gains taxes do not apply.

HOW YOU BENEFIT

  • You receive credit and an immediate income tax deduction for the fair market value (average of the high and low prices on the day of transfer).
  • You avoid capital gains tax.

Please note that the securities you use to make your gift must have been held by you for more than one year to be fully deductible.

MORE INFORMATION

When you donate appreciated securities to SKLT, you are able to deduct the gift as a charitable donation AND avoid capital gains tax at transfer. This double benefit allows you to leverage a larger donation by using appreciated securities rather than cash to make your gift. Here’s an example that applies equally to gifts of any size.

Assumptions: Donor in 33% Income Tax bracket; Capital Gains Tax rate 15%

  $10,000 CASH $10,000 STOCK COST BASIS $5,000 $15,000 STOCK COST BASIS $7,500
Charitable Deduction $10,000 $10,000 $15,000
Tax Savings @ 33% $3,300 $3,300 $4,950
Capital Gains Tax Saved $0 $750 $1,125
Net Cost of Gift $6,700 $5,950 $8,925

 

Transferring securities is a smart way to manage securities that have appreciated substantially and a) may no longer be aligned with your objectives or b) have grown in size to the extent they represent an increased risk factor in your portfolio.  It is simple process, and we can help navigate it.  Our custodian bank needs to know in advance if a gift is in the works, so please contact Julia Landstreet at 401-789-0962 to start the process.  In addition, be sure to first consult with your financial and tax advisors.