ARTICLE: Managing Charitable Stock Donations in Your Estate Plan

Managing Charitable Stock Donations in Your Estate Plan

When considering charitable giving, donating stocks can be a particularly powerful method. This strategy allows you to support your favorite causes while taking advantage of financial and tax benefits that cash donations might not offer. Giving stocks is especially advantageous if you have investments that have increased in value since you purchased them. Here’s a closer look at how this form of charitable giving works and the benefits it can provide.

Tax Benefits:

Avoid Capital Gains Tax: If you’ve held the stock for more than a year, you can avoid paying capital gains tax on the increase in value from the time you purchased it. This makes donating stocks directly more tax-efficient than selling them and donating the cash.

Tax Deduction: You can typically deduct the full fair market value of the stock at the time of the donation on your tax return, as long as you itemize your deductions.

How to Donate:

Choose the Right Charity: Ensure the charity you select can accept stock donations. Most large charitable organizations have systems in place to handle such gifts.

Transfer the Stocks: You’ll need to transfer the shares directly to the charity’s brokerage account. Your financial advisor or brokerage can assist with this process.

Documentation: Keep all records of the transfer and obtain an acknowledgment from the charity for your tax records.


Market Variability: Since the value of stocks can fluctuate, consider the timing of your donation to maximize its value for both you and the charity.

Charity’s Policies: Some charities might sell the stock immediately upon receipt, while others might hold onto it. This could affect the use and impact of your donation, depending on the charity’s needs and policies.

Strategic Giving:

Long-term Planning: Consider incorporating stock donations into your long-term financial and estate planning. This could involve setting up regular annual donations or using stocks to fund a charitable gift annuity or a trust.

If you are considering including charitable stock donations in your estate plan, Roth Elder Law, PLLC is here to assist you. We offer personalized guidance to help you navigate the legal complexities and ensure that your charitable intentions are effectively fulfilled in accordance with the law. To explore your options and create a plan that reflects your charitable goals and values, reach out to us today. Call our office at 607-962-6162 or complete this intake form, and we’ll be in touch to schedule a meeting.

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We at Roth Elder Law, PLLC, believe in providing services in a way that clients can easily understand and meaningfully participate in designing and maintaining their estate plan for their loved ones, as well as be assured that their plan will be administered according to their wishes.