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Donating stocks directly to nonprofits is a giving channel that is not often well understood or widely used. Yet donating appreciated stock is one of the easiest and most tax efficient ways donors can give more to causes they care about. Let’s take a look at 3 reasons why your organization should be asking donors to give stocks.
1. It's Tax Efficient.
Donating stocks directly to charities is one of the most tax-smart ways donors can give. When a donor gives stock shares (without liquidating them), they avoid having to pay capital gains tax AND they can still deduct 100% of the value of their contribution. That means they can receive a greater tax write-off at the market value of the stock upon donation, regardless of what they bought the stock for. Sometimes that tax deduction can even be more than what they originally paid! They save more, you receive more.
2. Immense Giving Potential.
Appreciated stock represents a huge opportunity for nonprofit funding. According to a 2016 study by Fidelity Charitable, “80% of donors own appreciated assets, such as stocks, mutual funds or bonds, but only 21% of those donors have contributed these types of assets to charity.” They aren't giving because they don’t understand the benefits and nonprofits aren’t sure how to receive them. Infinite Giving can help you change your stock giving narrative.
A study done by charitable giving expert Russell James, found that just mentioning strategic tax deductions increased charitable giving by almost 20%. In that same study by Russell James, they showed that nonprofits receiving stock in addition to cash increased fundraising contributions by 55%! The stock donations received are often larger than cash donations because donors hold more wealth in stock than cash. Let’s help them, help you.
3. It’s Easy To Do.
Giving and accepting stocks has been messy and over complicated for both donors and nonprofits until now. The benefits have been hard to understand and nonprofits don’t know how to help donors give them. Infinite Giving’s platform provides your organization with a brokerage account and a giving URL you can embed into your website, email, and giving campaign that allows donors to easily deposit stocks directly into your brokerage account. You get an email notification of the gift so you can send a thank you and then your organization can choose to hold the stocks, liquidate them, or reinvest them into a diversified portfolio with a click of a button.
In Summary:
For Donors: Directly giving stocks allows donors to give more to the causes that are meaningful to them while also reducing their taxes. How? When they donate stock, they avoid capital gains tax while also being able to deduct 100% of the value of their contribution.This means they can make a bigger impact with their donation!
For Nonprofits: Donating appreciated stock is an under-utilized but highly productive way for donors to give more to the causes they care about. If donors aren’t giving you stocks, it’s probably because you aren’t asking for them. Education and opportunity can open this giving channel to your organization and Infinite Giving can help you accept them easily with transparency and convenience.
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