Monday, December 14, 2015

Consider Making a Gift Contribution with Appreciated Property Instead of Cash

By Peter Sheldon

If you are contemplating a gift to a charitable organization that is exempt from tax under Section 501(c)(3) of the Internal Revenue Code, consider the possibility of making the gift with appreciated property rather than cash. With certain expectations, appreciated property that is given to a 501(c)(3) charitable organization and that would produce a long-term capital gain if sold by you instead of given away, can be deductible for tax purposes on your U.S. Income Tax Return in an amount equal to the full fair market value of the appreciated property. You can thereby avoid paying tax on the appreciated property that you have given away – a result that would not occur if you first sold the appreciated property and then gave the cash proceeds to the charitable organization.

For further explanation, please contact Peter Sheldon in our Lansing, Mich. office at 517-487-4720.