For business owners who are transitioning from success to significance, giving away your wealth can be even more rewarding than building it. Donors count on Adamy’s expertise to provide a Qualified Appraisal that will stand up to IRS scrutiny in support of their charitable gifts.
Donating appreciated stock is often much more tax-efficient than donating cash. While both cases give the donor a tax deduction, donating stock allows the donor to avoid the capital gain on the sale of that stock. This strategy is frequently used by donors with public stocks.
Business owners can also use this strategy ahead of a sale of their privately held business, often with a donor advised fund run by a charity that specializes in complex gifts. In order to qualify for a tax deduction from the donation of private stock, the donor must include a Qualified Appraisal of the stock with their tax return. This is where Adamy can help.
For business owners with significant charitable intentions, this strategy can allow them to put far more money to work for charity that would have otherwise gone to taxes. Doing it right requires working with tax advisors, a charity, and an appraiser who all have deep knowledge of the nuances and details of complex gifts. Treasury has specific requirements for Qualified Appraisals for deductions of private stock that exceed the requirements of estate planning and other tax appraisals.
If the taxpayer’s appraisal does not withstand IRS scrutiny, the results can be costly.
Charitable gifts of private stock, when done correctly, can allow a business owner to fund
many years of future charitable giving in the most tax-efficient way.
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