Donating appreciated stock to a nonprofit organization can offer several benefits:
- Tax deductions: By donating appreciated stock, you may be eligible for a tax deduction for the full market value of the stock at the time of the donation, up to 30% of your adjusted gross income. This can potentially provide a larger tax benefit than if you were to sell the stock and donate the cash.
- Avoiding capital gains tax: If you were to sell the appreciated stock, you would be required to pay capital gains tax on the increase in value. However, if you donate the stock directly to a nonprofit organization, you can avoid paying capital gains tax.
Donating appreciated stock to a nonprofit organization can be a smart way to give to A&K while also receiving potential tax benefits. However, it’s always a good idea to consult with a financial advisor or tax professional to ensure that this strategy aligns with your overall financial goals.
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