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updated
09.25.07
One
of the best ways to make a gift to Barnard — either
through a contribution to The Barnard Fund or a restricted
gift — is to donate appreciated securities. In most
cases, the out-of-pocket cost of your gift is reduced substantially
due to the "double" tax benefit you realize when
you contribute appreciated securities:
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First,
you are entitled to an income tax charitable deduction
for the full fair market value of appreciated securities
if they have been held for at least one year (or for your
cost basis if they have been held for less than on year).
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Second,
you pay no capital gains tax on the transfer.
Example
Julia Jones '48 would like to make a $50,000 gift to Barnard
in honor of her upcoming 60th Reunion, but it would be
difficult for her to make a cash gift of that magnitude.
Julia owns stock that has appreciated from her cost basis
of $10,000 to its $50,000 current fair market value. On
the advice of her tax advisor, she decides to use the
appreciated stock to make a special gift to Barnard. In
doing so, Julia essentially makes a $50,000 gift to the
College at an out-of-pocket cost to her of only $26,500.
The
following table illustrates the numbers behind her decision
to make a stock gift:
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Stock
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Cash
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Market
value of the gift:
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$50,000
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$50,000
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Cost
basis:
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$10,000
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$50,000
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Unrealized
capital gain:
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$40,000
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$0
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WHEN
THE GIFT IS MADE TO BARNARD
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Allowable
charitable deduction:
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$50,000
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$50,000
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Income
tax saved:(35% federal tax bracket x $50,000 deduction)
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-$17,500
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-$17,500
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Capital
gains tax saved:(15% federal rate x $40,000 gain)
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-$6,000
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$0
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Out-of-pocket
cost of gift:(gift value less income and capital gains
taxes saved)
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$26,500
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$32,500
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Julia
is delighted that the tax benefits of donating appreciated
securities provide an opportunity for her to make this
wonderful gift to Barnard College.
If
you are planning to make a gift of stocks, bonds
or mutual funds, please contact Yvette Edlow at Barnard's Office of Planned
Giving.
Call
212-854-2001
Fax 212-854-7550
Send an email to plannedgiving@barnard.edu
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Write
to:
Barnard College
Office of Planned Giving
3009 Broadway
New York, NY 10027-6598 |
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