Consider Donating Stock to Your Church | Rodgers & Associates

Why You Should Consider Donating Stock to Your Church in 2018

With trailing 12-month S&P 500 returns of 13% plus many investors could have the oppor­tunity to rebalance their portfolios. But what about incurring capital gains? If you make chari­table donations to your church, you may want to consider giving appre­ciated stock instead of cash. Although you may be aware of this option, you may not be aware of the necessary steps to implement this strategy successfully.

Step 1: Determine if your church has an account with a financial insti­tution to accept stock gifts.

Step 2: Obtain the transfer infor­mation from the church’s financial institution.

Typically, your church treasurer will have access to this infor­mation. This transfer detail includes the DTC routing number as well as the church account number and exact account registration.

Step 3: Determine the 2018 annual amount you will give to your church. Ask your financial adviser which appre­ciated stock and how many shares you will need to donate to meet your annual giving goal.

For many people, the idea of giving a one-time lump sum robs them of the satis­faction of giving during weekly church services. You may want to consider deducting $260 from the total so that you can continue to give a nominal weekly amount of say $5.

Step 4: Forward the transfer infor­mation to your financial adviser so that they can prepare an autho­rization form to transfer the stock to your church’s brokerage account. You will need to sign the appro­priate paperwork to initiate the transfer.

Step 5: Have your financial adviser prepare a letter to be sent to your church so that they are aware of the stock transfer as well of the stock price on the day of the transfer.

This is a vital step that is often overlooked. Unfor­tu­nately, there is no way to identify the stock with your name when it transfers into the church’s brokerage account. Upon receipt of the gift, the church will need to send you a donation acknowl­edgement letter. The IRS requires this letter for any gift over $250 so it is important to keep it with your tax records.

This is one of the many value-added services where your financial adviser can assist.