Gift stock to charity. No cost base data.

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fh2000
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Gift stock to charity. No cost base data.

Post by fh2000 » Thu May 05, 2016 12:19 pm

I have a stock that I own for a long time. It has gone thru splits, reverse splits, spin-off, and merger. I am not able to track down the actual cost base anymore if I sell it today. There is capital gain, and I just don't want to use $0 as my cost base, and claim the full amount as capital gain.

The current market value is about $10,000. If I donate all to charity, how much can I claim on my next year's tax form as charitable donation? Is it the full $10,000, or somehow I still have to guesstimate my actual capital gain?

sport
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Re: Gift stock to charity. No cost base data.

Post by sport » Thu May 05, 2016 12:23 pm

If you have held it more than one year, you can claim the full 10K. Don't sell and donate the money. You have to donate the shares.

inbox788
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Re: Gift stock to charity. No cost base data.

Post by inbox788 » Thu May 05, 2016 12:42 pm

I've done exactly that. Rather than guess or try to find really old cost basis, it was simpler to just give it away and get the tax benefit. I used Fidelity Charitable to do the donation and they send me the required tax form so it's well documented.

Ellie
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Re: Gift stock to charity. No cost base data.

Post by Ellie » Thu May 05, 2016 1:52 pm

Not an accountant, but I have filed these forms for myself before. You'll need to fill out Form 8283 for non-cash charitable contributions, which does indeed ask for basis for contributions having a value of $500 or more. If you want to be conservative, you can give the stock away in increments less than $500. Alternatively, you could put in either a low or no basis. You take the full amount as a charitable contribution (regardless of basis), so I am not sure why the IRS would even care about the basis.
Best thing that ever happened to me was being too busy in 2008 to pay attention to my portfolio.

Gill
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Re: Gift stock to charity. No cost base data.

Post by Gill » Thu May 05, 2016 2:49 pm

Ellie wrote:If you want to be conservative, you can give the stock away in increments less than $500. Alternatively, you could put in either a low or no basis. You take the full amount as a charitable contribution (regardless of basis), so I am not sure why the IRS would even care about the basis.
Why would anyone need or want to mess with giving away stock in less than $500 increments? Give the stock to charity and make a good faith estimate of the basis if basis is required.
Gill
Last edited by Gill on Thu May 05, 2016 3:28 pm, edited 1 time in total.
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal

SQRT
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Re: Gift stock to charity. No cost base data.

Post by SQRT » Thu May 05, 2016 3:05 pm

In Canada it would be the market price when donated. Ie $10,000. No need for cost basis.

Gill
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Re: Gift stock to charity. No cost base data.

Post by Gill » Thu May 05, 2016 3:06 pm

SQRT wrote:In Canada it would be the market price when donated. Ie $10,000. No need for cost basis.
Same in the US except IRS requests basis on certain securities. I've never been sure why.
Gill
Last edited by Gill on Thu May 05, 2016 3:28 pm, edited 1 time in total.
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal

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verbose
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Re: Gift stock to charity. No cost base data.

Post by verbose » Thu May 05, 2016 3:12 pm

From the instructions for 8283 (column g is labeled "Donor's cost or adjusted basis")

Column (g). Do not complete this column for property held at least 12 months or publicly traded securities. Keep records on cost or other basis.

You don't need to report the cost basis to the IRS for donated publicly traded securities.

Gill
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Re: Gift stock to charity. No cost base data.

Post by Gill » Thu May 05, 2016 3:27 pm

verbose wrote:From the instructions for 8283 (column g is labeled "Donor's cost or adjusted basis")

Column (g). Do not complete this column for property held at least 12 months or publicly traded securities. Keep records on cost or other basis.

You don't need to report the cost basis to the IRS for donated publicly traded securities.
You're right and I stand corrected. However, we're not sure if the OP's security is publicly traded. I've filled out that form a number of times and didn't realize the instructions abrogate the instructions on the form to include basis.
Gill
Cost basis is redundant. One has a basis in an investment | One advises and gives advice | One should follow the principle of investing one's principal

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GerryL
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Re: Gift stock to charity. No cost base data.

Post by GerryL » Thu May 05, 2016 3:42 pm

If you've got a DRIP set up to reinvest your dividends, be sure to turn it off at least a year before you donate the shares to charity so that you can be clear that you have held ALL the shares for more than 12 months. (I came to this realization while doing my 2015 taxes. I have been planning to replenish my DAF by getting rid of some inherited stock in three chunks over three years, starting last year. Shortly after the most recent x-Div date I turned off the DRIP so I won't need to try to figure out cost basis of the newest shares.)

letsgobows
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Re: Gift stock to charity. No cost base data.

Post by letsgobows » Thu May 05, 2016 4:22 pm

do exactly what inbox788 does. donate the stock through Fidelity. they will prepare the 8283 form for you and give you the FMV of the stock at time of donation. you are entitled to deduct the FMV at time of contribution and do not have to recognize any capital gain income.

1 caveat, since it is capital gain property there is a 30% limitation.

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