Gifts of Securities and Other Appreciated Assets

A gift of appreciated securities is a popular alternative to a cash gift because it actually saves taxes twice. You receive an income tax deduction for the full fair market value of your securities (if you’ve held them for more than one year) plus you also save the capital gain tax on the appreciation. Appreciated securities can be given as part of an Annual Campaign gift or as a contribution towards an endowment with the Jewish Foundation of Louisville. Contact us at (502) 459-0660 for individualized advise on your gift. Thank you for your generosity.

Marketable Securities (Stock)

One of the most advantageous ways to make a charitable contribution could be the donation of appreciated stock or stock subject to conversion that could avoid capital gains tax.  Many of you are currently taking advantage of making your charitable contributions by transferring securities to the Jewish Community of Louisville (JCL) to pay your Campaign pledge.  If you are paying with stock, or wish to pay with stock in the future, the following information will help assure the timely execution and proper application of the proceeds.

Methods of Transfer

Journal Entry
If your security is held in a brokerage account where JCL has an existing account you may request your broker to make an internal journal entry from your account to the JCL’s.  This is the fastest and easiest method of transferring securities if available unless you prefer to use one of our other brokers to execute the sale.  You will need to contact the accounting department at JCL (502) 459-0660 to determine if a brokerage account exists and to obtain the account number.  When instructions are issued to your broker to issue the transfer send a copy of those instructions and a copy of the attached transfer information to JCL’s accounting department

DTC
If your security is held in a brokerage account it may be electronically transferred by DTC from your account to the broker of your choice where JCL has an account.  The DTC needs to include JCL’s  correct account name, account number, DTC, and the donors name.  You may obtain the necessary information from the accounting department at JCL (502) 451-8840. When instructions are issued to your broker to issue the transfer send a copy of those instructions and a copy of the attached transfer information to JCL’s accounting department

Stock Certificate
A stock certificate in the donors name may be assigned to JCL without the donor having the certificate re-issued in JCL’s name.  The stock certificate will need to be signed on the back exactly as it is issued accompanied by a transfer letter requesting the shares be transferred to the Jewish Community of Louisville.  The letter needs to include the date, number of shares to be transferred, name of the shares, certificate number, and signature.  If hand delivered to JCL the donor needs to obtain a signed receipt.  If the certificate is mailed it should be sent to JCL by registered, insured mail.  3600 Dutchmans Lane Louisville, KY 40205. Send a copy of the attached transfer information to JCL’s accounting department.   Download a stock transfer sheet here.
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The Jewish Community of Louisville does not provide legal advice. Donors are encouraged to consult their independent tax and legal counsel.


Transfer Agent
If securities or dividend reinvestments are transferred from a donors account to a JCL account held by the transfer agent it is important to advise accounting at JCL in writing immediately upon transfer.  It will be necessary to request the agent to issue a transaction advice and a new shareholder form with instructions to sell. When instructions are issued to the transfer agent to execute the transfer send a copy of the instructions and a copy of the attached transfer information to the JCL’s accounting department. 

If you would like to discuss the transfer of securities in more detail or have any questions please stop by or call the Chief Financial Officer at (502) 618-5303.

 

IMPORTANT: Please notify JCL before making your gift of securities. Include the date, stock name, number of shares and cost basis. Without prior notification, stock gifts transferred to JCL without the identity of the donor, make it difficult to credit and acknowledge the donor.

 

Closely Held Securities

Give stock from closely held corporations. Closely held securities can be especially attractive in funding charitable remainder trusts or charitable remainder lead trusts. Special regulations apply to gifts of this kind. Consult your tax adviser and JCL when considering such a gift.

Real Estate

Give real estate that has appreciated in value. In most cases, a gift of real estate entitles you to a charitable deduction for the property’s full fair market value.

  • Real estate can be used to make an outright gift or to make certain types of planned gifts, resulting in a charitable deduction as well as reduced estate taxes.
  • Real estate can be placed in a trust and the proceeds from the sale of the property can provide you with a lifetime stream of income.

 

Lost Value Securities

Securities that have lost value are not usually considered for gift purposes. Consider selling the security and claim the capital loss deduction while donating the cash proceeds as a gift to JCL.

For more information contact Stew Bromberg, (502) 238-2755 or sbromberg@jewishlouisville.org.
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The Jewish Community of Louisville does not provide legal advice. Donors are encouraged to consult their independent tax and legal counsel.

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