How to Donate Stock to a Church
overview
The religious groups receive the most donations in the United States, with $128.7 billion in contributions in 2019 alone.
Donating stocks to charity is a tax strategy that contributors can use to deduct taxes. Many people use traditional methods of donating such as cash, checks, or other financial instruments; However, donating valued stocks is ideal for maximizing the gift by up to 37%.
Cocatalyst helps donors give stock in 5 minutes or less. You can give to any 501(c)3 charity in the United States, including churches.
If you are a church, the easiest and smartest way to grow a new source of fundraising is through stock donations. Sign up is free.
Americans donate money to all kinds of causes: education, human services, foundations, health organizations, the arts – the list goes on and on. But one category consistently receives the highest percentage of charitable contributions every year. Have a guess what that might be?
If you guessed religion, you are correct! Religion receives more charitable donations than any other single category in the United States, and this has been consistently true for the past several years.
According to Giving USA, the religion category of charities received $128.7 billion in contributions in 2019 – that’s 28% percent of all charitable giving that year, which totaled $449.64 billion from individuals, foundations, bequests, and corporations. Religious group receive significantly more than any other category: the second-largest recipient of donations is education, which received $64.11 billion, or 14%, of donations. This is only half the amount churches received in charitable contributions.
These numbers are too high to just be from a few dollars in the basket every Sunday! People of all religious backgrounds are making significant contributions to their religious centers, with the hope of improving the community, practice, infrastructure, and joy they bring to so many. Donations, like investing, should always be handled with care and financial savvy.
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When we gift our hard-earned money to any institution or cause, we want to make sure it has the greatest possible impact. When we donate to a church or charity, we might see our contributions materialize right before our eyes: new pews coming into our church, more books in our synagogue’s library, or added services at our mosque. We take pride in regular giving because we see the investment in our community unfold before us.
If you could make the impact of your donation even greater – why wouldn’t you? The reality is that donating stock to your church is almost always better than donating cash. Some people might feel overwhelmed at the prospect of donating stock – but don’t worry. This article will take you through the benefits of donating stock, tax considerations to watch out for, and how Cocatalyst can streamline the entire process for you.
Let’s dive in – so you can learn how to have the biggest gift impact you can on your community while saving on your taxes!
Tax Benefits of Donating Stock to a Church
Stock donations have tremendous value for churches. In fact, it is almost always better to donate appreciated stock, ETFs, or mutual funds than it is to donate cash.
This is for one simple reason: donating stock to your church allows you to avoid capital gains tax. This means the church gets the full value of your stock – potentially an additional 37% of your donation!
Say you own appreciated stock worth $27,400. If you sell it, you may pay $7,400 in capital gains tax, leaving you with $20,000 to give to your church as a tax donation. Instead, you can donate the stock directly to your church. The church then receives the full $27,400 value – and you write the full $27,400 value off on your taxes, too!
We all know an extra $7,400 can make a big difference for a church or charity. No matter the size of your donation, giving stock directly typically increases your gift amount by 37%. If you are making a sizable end-of-year contribution, this 37% can affect the organization’s programming, maintenance and repair, outreach, and community events for the coming year. Just changing the way you donate could pay your church’s expenses for a full month!
Photo by Karolina Grabowska from Pexels
Donating appreciated stock, ETFs, or mutual funds also allows you to reevaluate your investment portfolio and make sure you have a healthy balance of stocks. We know many people have financial portfolios that they love – but you still have to go to the doctor for a checkup even when you’re feeling fine! If you have stocks that have gone up (a great problem to have!), donating some of these assets to your charity will create space for you to buy new shares and reduce your future taxes. This can keep your portfolio balanced and help you avoid astronomical capital gains tax in the future.
If your stock donation is part of your end of year giving, and you are donating the stock on your own, make sure to contact your church ahead of time and let them know about your plans. The church may have specific procedures for receiving stock, and you want to make sure your donation goes through before the end of the fiscal year! Of course, donating through Cocatalyst is a much simpler solution: we streamline the process, and we make sure your church receives your donation as quickly as possible. (See more on Cocatalyst’s services below!)
Considerations of Charitable Stock Giving
Donating stock to a church is an excellent way to save on your taxes. You avoid capital gains tax for these appreciated stocks gifts, and also receive the normal tax deductions for . When you’re deciding how much and which stocks to donate, there are just a few things to keep in mind.
In order to receive the best tax deduction, you should donate appreciated stock that you have held for more than one year. You will then get a tax deduction equal to the stock’s fair market value – not what you originally paid for the stock. You’ve already increased your deduction, just by owning this stock!
You might also be thinking about transfer a losing stock to charity. In this case, it is better to sell the stock and give the funds directly to your church. This way, you can take the capital loss and still deduct the full cash amount from your taxes. The church receives the same amount either way.
Finally, as with all charitable contributions, make sure to itemize your deduction come tax season. Only itemized deductions can be deducted from your taxes, and you must have a record of the donation. If you donate stock through Cocatalyst, this is easy – we’ll send you a receipt immediately after liquidating your stocks!
Let Cocatalyst Help You Donate Stock to a Charity
Cocatalyst was founded to simplify the process of donating stock, ETFs, or mutual funds to a church. We know you lead a busy life, and your charitable donation doesn’t have to be a hassle! We believe giving stocks instead of cash is an easy way to maximize both your church impact and your savings, and we’re here to help you through that process.
Your church can also register with Cocatalyst – or maybe they already have. Then Cocatalyst takes on all the work of receiving their account information, working with their process and deadlines, and other financial communication that may come up with donations of stock.
If you are ready to donate, you just have to follow these easy steps
1. Visit the Cocatalyst stock donation page.
2. Fill out the form.
3. Complete the signature.
And that’s it! You will receive the tax receipt as soon as we receive the stocks. The funds will be transferred to your church after we liquidate the shares.
Cocatalyst for Church Management
Cocatalyst’s services make life easier for charities, too. If you are a church interested in receiving donated stocks, you can sign up through Cocatalyst to simplify the process and get your donations sooner. Cocatalyst will take care of all donor information, so you no longer have to work individually with each donor. Cocatalyst also looks for employer gift matches that may stretch your dollar even further in service of your organization. In total, gifts can be up to 275% larger by using Cocatalyst. Charity organization can add Cocatalyst on their website by visiting our process stock donations for charities page.
Many good-hearted people make charitable contributions every year, but they don’t always know how to optimize these donations to get the highest value to their churches while saving the most on their taxes. Cocatalyst is here to protect your interests and keep money in your and your church’s pockets.
Donating stock through Cocatalyst is completely free, and all 501(c)3 nonprofits are supported. This makes your life easier and ensures your generous donation gets where it’s going as quickly as possible. You can begin your stock donations today!
In Summary: Stock Donation Quick Facts
We hope this article has demystified the process of donating stock to your church. It’s easy to get overwhelmed by the tax forms if you are donating stocks yourself, but Cocatalyst is here to simplify the process. We’ve gone over a lot of information so far; here are the quick facts you need to know about donating stock to your church.
· It is almost always better to donate stock, ETFs, or mutual funds than it is to donate cash.
· It is best to donate appreciating stock that you have held for a year or more.
· Stock donations allow you to avoid capital gains tax, thus increasing benefit to the organization.
· Stock donations create an opportunity for you to review your stock portfolio.
· You can receive a tax deduction on stock donations up to 30% of your income.
· Cocatalyst is free for donors, an easy-to-use online platform to streamline your stock donations every step of the way!
Don’t wait until the end of the year – take this opportunity to reevaluate your portfolio and start a stock donation with Cocatalyst. We’re just waiting to help you start giving!