Appreciated stock offers powerful tax benefits as an outright gift or as funding for a life income gift.
OPTION 1 — an outright gift of appreciated stock
You may find that giving appreciated stock (held for more than one year) lets you make the biggest impact for the lowest cost. Consider the double tax benefit:
- You qualify for an immediate income tax charitable deduction for the full value of the stock if you itemize.
- You owe no capital gains tax on the appreciation.
Note that your maximum deduction for long-term appreciated stock is 30% of your adjusted gross income. Any excess deduction can be carried over for up to five years.
Publicly traded stocks are the most commonly donated appreciated securities, but you can also give bonds, mutual fund shares, or closely held stock.
Selecting the best stock to give
The best choice depends on your portfolio, investment goals, and tax situation. General guidelines indicate that you might consider a stock:
- Held for more than one year (since that will allow you to deduct the full fair market value)
- With significant appreciation (since that will provide the greatest tax benefits)
- That will help you reposition your investments and rebalance your portfolio
- That lowered or cut its dividend
It’s a great blend of two things for me. Immediate impact with a gift to Miami and an immediate tax advantage to me for the donation. Plus, I enjoy an ongoing income stream from the stock that was previously only appreciating on paper. It’s like I still own the stock, but I have the income instead of appreciated gains. A win-win.
Ralph Herda ’75
OPTION 2 — funding a life income gift with appreciated stock
Another option is to use appreciated stock to fund a life income gift, such as a charitable gift annuity or a charitable remainder trust. Benefits include the following:
- You qualify for an income tax deduction (if you itemize) in the year of the gift.
- You create an income stream to supplement other sources of retirement income — income that is likely to be higher than any dividends you might be receiving from the stock.
- You may be able to reduce or spread out the payment of capital gains tax on the appreciation.
Evaluate the fit.
Appreciated stock may be a particularly good option to consider if you:
- Have stock you want to sell but don’t want to pay tax on the significant appreciation
- Want to rebalance your portfolio
- Want to employ one of the most powerful gifting options with double tax benefits
See how it works.
For the past few years, Jennifer has given Miami University a check for $10,000. This year, she realizes that the growth of some of her stocks has caused her investment portfolio to become too heavily weighted in equities. She decides to give us stock worth $10,000 that she purchased years ago for $1,000. If Jennifer itemizes, she can take a deduction for the full $10,000, even though $9,000 of it has never been taxed. In her 37% tax bracket, the tax savings are substantial.
Gift of Cash | Gift of Stock | |
Jennifer’s gift | $10,000 | $10,000 |
Income tax savings (37% tax bracket) | $3,700 | $3,700 |
Capital gains tax savings (23.8% of $9,000) | -- | $2,142 |
Tax savings generated by Jennifer’s gift | $3,700 | $5,842 |
Consider your timing.
If you want to qualify for a charitable deduction this year, you should initiate the stock transfer by Monday, December 22, 2025. You can also give mutual fund shares, but these gifts take longer — initiate by December 1 to ensure sufficient time for a year-end gift.
Making a gift of stock
For Transfers of Common Stock, Preferred Stock, or Bonds
Northern Trust For DTC eligible securities:
DTC: 2669
Agent bank ID: 20290
A/C #: 44-79707
Account name: Miami University Foundation – Gift Account
For Federal Reserve eligible securities:
ABA #: 071000152
A/C #: 44-79707
Account name: Miami University Foundation – Gift Account
Primary contact person at Northern Trust:
Ana Gjorgievski
312-444-4749
ag679@ntrs.com
Back-up contact person at Northern Trust:
Jessica Strub, VP & Sr. Relationship Manager
585-233-7177 telephone
312-630-6062 fax
JS942@ntrs.com
The Northern Trust Company
50 S. LaSalle Street
Chicago, IL 60603
Commission for common stock:
$0.025 per share, $9.95 minimum
For Transfers of Mutual Funds
To deliver mutual fund shares via ACATS to the Miami University Foundation Gift Account at Northern Trust:
Receiving Client Trust Account #: 44-79707
Northern Trust DTCC participant ID: 2669
Please note some mutual fund gifts cannot be completed via ACATS. If the delivering firm is not ACATS eligible, or if the mutual fund is not ACATS eligible, please contact Bruce Guiot at guiotba@MiamiOH.edu or your development officer.
For Transfers of Common Stock, Preferred Stock, or Bonds
If a transfer or transaction is expected to be complex or require a higher level of service, you may use Merrill Lynch, which charges a higher commission on the sale as outlined below:
Merrill Lynch
Endowment Account #: 639-04061
Foundation Account #: 639-04116
DTC #: 8862
Contact Person at Merrill Lynch
E. Fred Gallenstein
513-985-5899
Marc G. Gallenstein
513-985-5866
Commission:
1 - 200 $0.05 per share
201 - 499 $0.03 per share
500 and above $0.025 per share
We can help.
We can provide you and your advisors with the information you need to choose a gift with maximum benefits, including an illustration that will clearly represent the anticipated financial and tax benefits of your hypothetical gift.