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Depending on your objectives, there are numerous methods to give charitably - several are listed below. Non-cash giving may allow you to give more to charity and reduce your taxes, without having to reduce your personal lifestyle expenses. We encourage you to discuss with a Financial Advisor about the best method for your particular financial situation.

Giving Non-Cash Appreciated Assets
Giving appreciated assets, such as stocks, bonds, mutual funds, land, or real estate, can be advantageous for both the giver and the receiver. This method allows the giver to maintain current cash, while reducing income and/or estate tax liabilities. The recipient acquires a gift that can be sold at fair market value - free of taxes. The following chart illustrates the benefits of giving appreciated assets.

The Benefit of Giving Appreciated Assets vs. Giving the Proceeds from Selling the Asset

Sell Stock, Contribute Proceeds Gift of Appreciated Stock
Current Market Value $50,000 $50,000
Capital Gain Tax on Sale - $8,000 - n/a
Net Deductible Funds to Charity = $42,000 = $50,000
Donor's Tax Rate x 28% x 28%
Tax Savings for Donation = $11,760 = $14,000
Tax on Capital Gain - $8,000 - n/a
Net Tax Savings for Donor = $3,760 = $14,000
Funds to Charity $42,000 $50,000
Net Tax Savings for Donor $3,760 $14,000
Total Benefit $45,760 $64,000
Current Market Value $50,000
Tax Cost Basis $10,000
20% Tax on $40,000 Capital Gain if Stock Sold ($50,000 - $10,000) $8,000

Giving Gifts of Life Insurance
Life insurance policies purchased while building a family may later in life prove to be good charitable gifts that can offer tax advantages. If other assets are now providing the income your family will need after your lifetime, consider transferring ownership of your policy to your favorite charity, thereby reducing estate taxes.

Giving Retirement Plan Assets
Because most retirement assets have been sheltered from income tax, they are subject to double taxation in your estate (income and estate tax). By bequeathing your retirement plan assets to your favorite charity, your heirs will realize income and estate tax savings and the charity will receive the full value of the gift.

Giving Gifts in Kind
Gifts in Kind, also known as in-kind donations, refer to when goods and services are given instead of giving cash. Examples of in-kind gifts include goods such as furniture, office equipment, and other material items that may needed or easily sold.  Performance of some kind of services may also be counted as in-kind gifts.

Key Benefits of Non-Cash Giving

    Less to taxes – By donating non-cash assets you typically receive a tax deduction for the full fair-market value of your gift, as well as avoid capital gains taxes.  
    More to ministry – The capital gains taxes you save from giving the asset directly to charity means more goes to support the work of God’s Kingdom.  
    Personal savings – Because you receive the full tax deduction for the fair-market value of the asset, you’ll see great savings on your personal income tax returns. This means more money stays in your pocket for your lifestyle expenses or additional giving.

Ronald Blue & Co. (“RB&Co.”) obtains historical and other information from a wide variety of publicly available sources. The information and material provided is for informational purposes only and is intended to be educational in nature. We have taken all reasonable care and precaution to ensure that the information is fair and accurate, or has been compiled from sources believed to be reliable. We shall not be liable for any direct, indirect, or consequential loss arising from any use of or reliance on the information contained here. RB&Co. and its affiliates do not have, nor claim to have, sources of inside or privileged information regarding expected future returns on any investment proposed. The recommendations developed by RB&Co. are based upon the professional judgment of RB&Co. and its individual affiliates and neither RB&Co. nor its affiliates can guarantee the results of any of their recommendations. Clients and individuals at all times may elect unilaterally to follow or ignore completely, or in part, any information, recommendation, or advice given by RB&Co. and its affiliates.