TWP Canopy - Heal the Planet Beyond your Lifetime with Appreciated Assets
*August is Make a Will Month and this is the fourth in a six part series about dedicating your legacy to a healthy climate future through Trees, Water & People (TWP).
Many Trees, Water & People (TWP) donors have found value in gifting appreciated assets to avoid taxes owed on appreciated real estate or on large returns in the market. Below are some different ways to approach each.
Donating Appreciated Securities to TWP
Donating appreciated stocks, bonds, ETFs, options, mutual funds, and treasury notes to TWP can offer significant advantages over donating cash.
When you donate appreciated securities directly, you avoid capital gains taxes (up to 20%), because you do not sell them first. As a result, the full value of the asset goes to TWP, maximizing the impact of your donation. In most cases, you can also claim a charitable deduction for the fair market value of the securities if you itemize deductions for tax purposes.
Assets with the highest amount of appreciation can benefit the most from this strategy. Donating appreciated securities can represent a smart way to give, allowing you to support nonprofit organizations like TWP while also optimizing your tax benefits.
Leave appreciated Real Estate to TWP
Depending upon your goals, appreciated real estate can be used to produce an immediate charitable income tax deduction, provide an income back to you, and/or establish a future legacy gift that would cost you nothing today. As these gifts can be complex, consulting with your advisors and TWP can help ensure that your vision for your gift is fully realized.
A gift of property during your lifetime can provide a tax deduction that can be itemized over five years. It can also reduce the size of your estate and associated taxes. If you’d like to deed the property to a nonprofit in life, but retain use of the property for a determined amount of time, a Retained Life Estate allows you to build such an agreement.
To gift real estate upon your passing, you can designate property directly to a charity like TWP in your trust documents, or notarize and record a Beneficiary Deed to the property that instructs for the property to transferred on death to a named beneficiary, like TWP. A beneficiary deed avoids probate court, and is revocable or modifiable during life.
Talk to your financial advisor, CPA, or estate planner if you have a property that you are interested in donating to a nonprofit organization like Trees, Water & People.
