By Jim Andreano • Fundraising Committee Chair, Jimandreano@gmail.com
Are you considering making a significant donation to the New Jersey Chapter of the Sierra Club, and do you wish to do so in the most tax-efficient way possible? If so, consider donating appreciated securities. Here’s how it works:
Example 1
You wish to donate $10,000. You plan to fund this donation by selling $10,000 worth of stock. Your cost basis (i.e., the stock purchase price) is $4,000. Therefore, you have a $6,000 capital gain. Assuming you are in the 15% capital gains tax bracket and you owned your stock for longer than a year, your tax on the sale is $900.
If you simply sell the stock before donating, you will have to give that $900 to Uncle Sam. However, that leaves you only $9,100 to donate.
Example 2
Same as Example 1, except that instead of selling the stock and donating the cash proceeds, you donate the stock directly. You have incurred no capital gain. Our Chapter can sell the stock without paying capital gains tax and receive the full $10,000.
Additionally, if you itemize tax deductions, and if you choose to make your donation to the Sierra Club Foundation on behalf of the Chapter, you may be able to deduct the full $10,000 from your taxable income, subject to IRS limits on charitable contributions. You don’t have to pay taxes on that stock sale, but you do get to deduct. You have beaten Uncle Sam. How often does that happen?
If you wish to support the New Jersey Chapter of the Sierra Club via a donation of appreciated securities, please contact Club Treasurer Paul Sanderson at treasurer@newjersey.sierraclub.org or (908) 233-2414.
We recognize that not everyone can donate at this level. We value all donations at whatever amount you feel is comfortable. Our annual year-end appeal is now under way. Please be on the lookout for our appeal letter in the mail!
You may also participate in our appeal at www.sc.org/njstrong2025, or by mail:
Sierra Club, New Jersey Chapter
P.O. Box 269,
Garwood, NJ 07027-0269
We thank you for your support!