Outright Gifts of Cash and Securities (stocks, bonds, etc.)
Outright gifts allow you to claim charitable tax deductions in the year in which the gift is made.
Gifts of Cash
The most common form of giving, cash gifts, are as easy to make as writing a check to the CCBC Foundation, or giving on-line. Every dollar you give outright to CCBC is tax-deductible, and cash gifts are vital, since they are immediately available to assist deserving students or programs.
Gifts of Securities
Publicly Traded Stocks or Securities - Gifts of appreciated securities are tax-deductible at full market value. They also relieve the donor from long-term capital gains tax on the appreciation. This double tax savings makes it possible for a significant gift to be made at a remarkably low after-tax cost. Appreciated securities often represent the most economical way to contribute during one’s lifetime.
For example: In 1980, you bought stock in company BUY at a cost of $2,500. Today, the stock is worth $10,000. You have a long-term capital gain of $7,500. Assuming a federal capital gains tax rate of 20%, you would owe a tax of $1,500 if you sold the stock. Instead of selling, you contribute the stock to CCBC. Your $10,000 gift saves $3,100 in income tax (31% x $10,000), plus $1,500 in capital gains taxes, for a total savings of $4,600. Your total gift of $10,000 was made at an after-tax cost of only $5,200.
Closely Held Stock
Owners of closely held corporations may donate shares of their stock to CCBC, receive a charitable deduction, and retain full control of their business, all without having to claim a stock dividend.
For example: You own 80% of your corporation and decide to donate a few shares totaling $10,000 to CCBC. The stock gift still leaves you in full control of your business, and the charitable deduction saves you $3,100 in income taxes (assuming a 31% tax bracket). CCBC chooses not to keep the shares and returns them to your corporation for redemption. Your corporation gives CCBC $10,000 and retires the stock. As long as the college is not required to turn back its shares to your corporation, you are not considered to have received a dividend and do not have to pay any additional tax, even though $10,000 has been removed from your corporation.