A Security is a financial investment with a monetary value. It entitles the holder to ownership of a part of a publicly traded company. A security can be a stock or a debt obligation, such as a bond.
The Gift of Security is the donation of a security (stock, bond or mutual fund) to a charity. Gifting a Security is often referred to as a “gift in-kind”, meaning it is a non-cash donation.
When stocks are sold at an appreciated value then 50% of the capital gain (market value of stock less purchase price) must be reported as income.
By donating Securities you will receive a full income tax exemption on the capital gain.
There are additional advantages to donating Gifts of Securities which include:
- A charitable receipt for the full market value of the donated security.
- Demutualized life insurance company shares are most beneficially donated in-kind; they are all pure capital gain.
- In-kind transfers of shares are an excellent tax saving strategy when downsizing, retiring, or for instructions in a Will.
Since Global Aid Network does not have a brokerage account, Link Charity will accept the security, sell it, and give the cash proceeds to Global Aid Network. Currently, Link Charity has 10 brokerage accounts open to meet the needs of donors, including our newest broker, Investors Group.
Once the stock is transferred to Link Charity to be sold, Link Charity will distribute the proceeds to as many charities, in whatever amounts you choose.
If you have the stock you wish to sell or you are subject to a takeover, but you have not decided what charities should receive the proceeds or you want the proceeds to be given out over several years, Link Charity can fulfill both requests on your behalf.
For more information about link charity visit their website at: linkcharity.ca