Top 3 Reasons You Should Give Stock

Can you donate stock to charity? Yes, you can—and there are several reasons you should. Here are three of the most compelling advantages of donating appreciated stock vs. cash.

Charities Get More Money—Without You Giving More Money

When you sell stock and give the proceeds to charity, you will likely be responsible for tax on the capital gains. That portion goes to the IRS, which means that the charity only receives the leftover net profit.

But when you make a donation of appreciated stock to a private foundation, you won’t be on the hook for the capital gains tax. The charity receives the entire amount of the stock’s value, including what you would have to pay to the IRS if you sold the stock first.

This structure has helped charities to realize significant increases in tax-free donations without donors having to pay for that increase themselves. It quietly revolutionized the concept of charitable donation.

You Can Rebalance Your Portfolio

Your stock portfolio needs attention from time to time. Some commodities appreciate more than others. Over time, those holdings may gain value to the point at which they command a higher share of your investments—which can throw your portfolio out of balance.

Gifting stock to a charity might be a great way to correct that imbalance. Rather than selling the appreciated stock or figuring how to reallocate funds, this can recalibrate your portfolio so it’s more diversified and consistent. Along with saving on future capital gains taxes, you just might be able to make your financial health strategy stronger.

You Promote Positive Change for Everyone

The effects of charitable donation on organizations are obvious. Nonprofits need funds to run and expand the work they do. That work tangibly changes the lives of others.

But the effects giving has on donors themselves can’t be overlooked, either. Charitable donations are underestimated enhancers of a person’s mood, psyche, and mental health. The joy of giving—regardless of your motives—often manifests itself over time.

There’s a lot to be said for the feeling of connectivity that charitable giving promotes: You become part of a bigger effort to change things for the better. With a donation of stock to non-profits you care about, that change is easier to bring about. Everybody wins.

Make DonateStock Your Agent of Change

DonateStock makes it incredibly easy to give your favorite causes the funds they need—and to find new causes you may care about. Find out more on our donors page.