Serving Union County since 1953 A 501(C)(3) Charitable Organization 126 N. Main Street, P.O. Box 608, Marysville, Ohio 43040 Phone: 937.642.9618 Fax: 937.642.7376 Helpful Articles from the Union County Foundation Director Year End Giving By David Vollrath, Executive Director Union County Foundation The New Year is fast approaching and we are deep into the Holiday season. Many people use these last few weeks of the year to complete their charitable giving for this tax year. Below you will find some guidelines and advice for completing your 2006 charitable contributions. Too often the wisdom of gifting appreciated stock is not recognized. As a general rule a gift of appreciated stock (rather than cash) is a prudent gifting method. Here is why: A donor giving a $5,000 check receives a tax deduction for $5,000. Similarly if stock valued at $5,000 (purchased originally for $1000) is gifted, the donor still receives a $5000 charitable deduction but in addition benefits from a by-pass of capital gains tax. Here is why: exclusive of the donation if the donor were to sell the block of stock there would be $5,000 of sales proceeds minus the $1000 cost basis, resulting in a long-term capital gain of $4000. This capital gain would be subject to federal tax of 15% (for most tax payers) resulting in $600 of federal tax. Additionally many states will also tax the capital gain. By gifting the stock directly to a tax exempt charity the donor avoids the capital gains tax, receives the full charitable deduction, avoids taking any cash out of his or her cash reserves, and the charity ultimately benefits from the proceeds of selling the stock. Here are some additional guidelines for year-end charitable giving. Pledges – A pledge is not deductible until the funds have actually been paid. Stock Gifts - The gift value for publicly traded stock is the average between the highest and lowest sale price on the date of the gift. For end of year gifts it is very important that the transfer be effective by December 31, 2006. Written confirmation that the charity has taken actual possession of the stock or that the financial services firm has transferred the shares to an account for the charity must be in your tax records. Property – If property over $5000 other than publicly traded securities is gifted to charity then a qualified independent appraisal must be obtained. In most cases the appraisal may be obtained up until April 15, 2007 or to an extended filing date if applicable. Cash – Generally gifts are deductible when they are delivered. A cash gift is deductible when the charity receives the cash. A check is also deductible when given to the charity. If a check is sent in the mail the date of the mailing is the effective date for the deduction. This is especially important for year-end gifts. In order to deduct a gift this year you must be certain that the gift was made or mailed before December 31, 2006. The IRS requires that charities provide donors a legal receipt by April 1, 2007 for cash gifts made in 2006 of $250 or more. Credit Cards – A charitable gift given by credit card is deductible when the card is charged not when the charge card billing is paid. The Union County Foundation is equipped to help you achieve your charitable goals by providing: planned giving and estate planning resource information, charitable gift annuities/life income plans, and a broad array of charitable choices including establishment of scholarship funds and donor advised funds. Please call us at 937-642-9618, email info@unioncountyfoundation.org, reference our website at www.unioncountyfoundation.org, or stop by our Marysville office at 126 N. Main St. We are committed to helping you… "preserve your footprint in time."

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