Securities and mutual funds that have increased in value and been held for more than one year are one of the most popular assets to use when making a gift to Diocese of San Jose. Making a gift of securities or mutual funds to us offers you the chance to support our work while realizing important benefits for yourself.
When you donate appreciated securities or mutual funds you have held more than one year to us in support of our mission, you can reduce or even eliminate federal capital gains taxes on the transfer. You are also entitled to a federal income tax charitable deduction based on the fair market value of the securities at the time of the transfer.
Securities are most often used to support our work in the form of:
An outright gift. When you donate securities to DSJ, you receive the same income tax savings that you would if you wrote us a check, but with the added benefit of eliminating capital gains taxes on the transfer, which can be as high as 20 percent. Making a gift of securities to support our mission is as easy as instructing your broker to transfer the shares or, if you have the physical securities, hand-delivering or mailing the certificates along with a stock power to us in separate envelopes. (Using separate envelopes safeguards your gift—the certificates will not be negotiable without the stock power.)
A transfer on death (TOD) account. By placing a TOD designation on your brokerage or investment account, that account will be paid over to one or more persons or charities after your lifetime. It is not necessary for the TOD designation to transfer all of the account solely to charity—you can designate a certain percentage of the account. With a TOD account, the beneficiary you name has no rights to the funds until after your lifetime. Until that time, you are free to use the money in the brokerage account, to change the beneficiary or to close the account.
A gift in your will or living trust. If you aren’t ready to give up these assets during your lifetime, a gift of securities through your will or living trust allows you the flexibility to change your mind at any time. You can continue to receive dividends and participate in shareholder votes, and the securities are still yours if you need them for other expenses. In as little as one sentence you can ensure that your support for DSJ continues after your lifetime and that your estate will benefit from a charitable estate tax deduction.
A memorial gift. If you have a friend or family member whose life has been touched by DSJ, consider making a gift to us in his or her name.
An endowed gift. Create an endowment or contribute to one that is already established to ensure that your support of DSJ will last forever.
A charitable gift annuity. Funding a gift annuity with appreciated securities or mutual funds will not only provide you with reliable payments for life and allow you to support our work, but it can offer numerous financial benefits. First, your annuity payments are often more than the dividends you would receive each year from the securities. Second, you will receive a federal income tax charitable deduction in the year the gift is made and eliminate part of the capital gains tax you would have paid if selling the securities.
A charitable remainder trust. Highly appreciated securities are one of the best ways to fund a charitable remainder trust. You may be reluctant to sell such assets directly because of the tax you would pay on the gain; however, if the assets were transferred to a charitable remainder trust, the assets can be sold without incurring the capital gains tax. The trustee can then reinvest the proceeds in order to secure a higher current income yield.
A charitable lead trust. Rapidly appreciating assets such as stocks are a great way to fund a charitable lead trust. The assets transferred to the lead trust are frozen in value for transfer-tax purposes at the time of funding. At the end of the trust’s term, all appreciation that takes place in the trust will pass tax-free to your heirs.
Calculate Your Benefits
Submit a few details and see which gift is right for you.
- Contact the Stewardship Office for additional information on appreciated securities.
- Seek the advice of your financial or legal advisor.
- If you include DSJ in your plans, please use our legal name and federal tax ID.
Legal Name: (LegalName)
Federal Tax ID Number: Please contact us for our federal tax ID number.
The information on this website is not intended as legal or tax advice. For such advice, please consult an attorney or tax advisor. Figures cited in examples are for hypothetical purposes only and are subject to change. References to estate and income taxes include federal taxes only. State income/estate taxes or state law may impact your results.