Donating Stocks and Mutual Funds

Donating stocks or mutual funds is a tax-efficient way to support a cause you care about. This article explains how the stock and mutual fund donation process works, what to expect during the transfer, and common questions donors have.

How the Stock and Mutual Fund Donation Process Works

To begin, iDonate will provide a Letter of Authorization (LOA) for you to complete and give to your broker. Your gift is not considered complete until your broker initiates and completes the transfer.

Once the stock or mutual funds are successfully transferred, the assets are liquidated and the proceeds are forwarded to the designated organization. You will then receive a gift-in-kind receipt for your records.

Benefits of Donating Stock or Mutual Funds

Donating appreciated securities can provide meaningful benefits to both the donor and the organization.

Common benefits include:

1. A potential charitable deduction for the fair market value of the donated assets in the year of the gift

2. Avoidance of capital gains tax on the appreciation of the donated securities

Because tax situations vary, consult with a qualified tax advisor to understand how these benefits apply to your specific circumstances.

Donating Physical Certificates or Assets Held by a Transfer Agent

If you are donating physical stock certificates or securities held by a transfer agent, specific transfer instructions will be provided. These instructions may require a completed form and a medallion signature guarantee.

Once all required documentation is submitted, the transfer process can be completed.

Completing the Online Stock Illustration Without Exact Details

The online gift experience prepares a personalized illustration of the benefits from giving your stock. If you don’t know your exact information, that’s okay. This is for illustration purposes only.

Tax Deductibility of Stock Donations

In many cases, donors may be eligible to deduct the fair market value of the donated stock at the time of transfer. Tax rules governing charitable deductions change frequently, and individual eligibility can vary.

For accurate guidance, consult a tax professional. This information is provided for general educational purposes and does not constitute tax or legal advice.

Using Broker-Specific Transfer Forms

You are not required to use a specific stock donation form. If your broker provides their own transfer documentation, it may be used.

However, all required identifying information must be included so the gift can be properly matched and credited once received.

If you have questions during the process, Support can assist with next steps or documentation requirements.