Tax considerations vary according to assets:
The deduction is for the amount of the cash contribution but is limited to 50% of the donor’s adjusted gross income (“AGI”) in the tax year in which the contribution is made. Deductions may be subject to certain other limitations based on income.
Publicly Traded Securities
For publicly traded securities held for more than one year, the deduction is the mean of the high and low prices reported on the date of the contributions.
For mutual fund shares held for more than one year, the deduction is the closing price on the date of the contribution.
For securities or mutual fund shares held for one year or less, the deduction is the lesser of the asset’s cost basis or fair market value.
Deductions for contribution of appreciated securities held for more than one year are limited to 30% of AGI. Donors may carry forward and deduct any excess amount for up to five years after the year of the contribution.
Private Securities, Real Property and Business Interests
The deduction is the fair market value on the date of the contribution if the assets contributed have been held for more than one year. The deduction is the lesser of the cost basis or fair market value for assets held a year or less. The IRS requires a qualified appraisal for any contributed property (other than money and publicly traded securities) for which a donor will claim a deduction of more than $5,000.
Tax Treatment of Fund Investment Earnings and Distributions
Income and capital gains are credited to the fund and not to the donor or the donating business entity. Investment earnings will be reflected in the market value of the fund. Donors receive a charitable deduction at the time of a contribution but will not be entitled to take charitable deductions for ongoing investment earnings or grant distributions from the fund. Amounts distributed may include appreciation since the date of the gift.
Tax Treatment for Gifts to Supporting Organizations of the Foundation
Contributions to a Supporting Organization of the Foundation or funds of the Supporting Organization are treated in the same way for tax purposes as those made to the Foundation.
Tax Treatment When Goods/Services Have Been Provided
The tax deductible amount is reduced by the fair market value of any goods or services received by the donor in connection with the gift.
Read more by downloading the complete Charitable Giving Guide.