The University of Toledo

Tax-Efficient Ways to Give and Save on Taxes

As we near year-end, there are several sound strategies to increase tax savings and facilitate a gift to programs you value at The University of Toledo. 

Tax-Efficient Ways to Give 

Cash:  Always a simple and easy gift transaction!  Remember, if mailed, the envelope must be postmarked by December 31, 2008.  Cash gifts are deductible up to 50% of adjusted gross income with a five year carry over of any excess deduction. 

Stocks or Mutual Funds:  Gifts of appreciated securities and mutual funds owned for one year or more produce a double tax benefit – you avoid capital gains tax and you are eligible for a charitable income tax deduction of the fair market value of the asset up to 30% of your adjusted gross income with a five year carry over of any excess deduction.  You should allow at least one month to complete a transfer of mutual fund shares.  

Stocks Sold at a Loss:  You lose your deduction for loss in value of the stock if you give it directly to a charity.  However, if you sell the stock at a loss, that generates a tax deductible loss.  Then you can gift the sale proceeds and be eligible for a charitable deduction of cash.   

Life Insurance Policies:  A gift of an existing policy generally will produce a charitable income tax deduction and gifts of future premiums also will be deductible.  This is an effective means of using a policy when the reasons for the original purchase are no longer compelling. 

Life Income Plans:  A charitable gift annuity and a charitable remainder trust provide a specified income for life while the residue or remainder passes to the programs important to you.  Appreciated assets, such as stock, are a practical funding source that helps you diversify and reinvest while obtaining tax savings.   

Information on IRA Charitable Rollover