It's important to educate potential donors about the benefits of giving appreciated stock to your organization.


Let's say that a contributor is interested in donating $10,000. In return, of course, the person will receive a charitable deduction based on his or her tax bracket. But what if the contributor sold $10,000 worth of stock -- purchased one or more years ago for $2,000? After the sale, the supporter wrote a check for $10,000 to your organization.

The result for your not-for-profit is the same, but it is very different for the individual who sold stock to make a contribution. The donor is going to have to report a capital gain of $8,000 and generally pay a federal capital gains tax of 15 percent ($1,200), as well as state tax. By giving stock, the donor would be exempt from paying capital gains tax.

By informing your supporters about the advantages of this tax-saving strategy, you can encourage more contributions.

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