Gifts of Appreciated Securities or Mutual Funds:

You can avoid capital gains tax on appreciated securities and, at the same time, make a contribution to the James E. Rogers College of Law, by giving those securities directly to the College rather than selling them outright.  This way you can take a big bite out of your taxes and help the College too.

Of course, for many alumni and friends, tax savings, as large as they may be, are often the least valuable reward of giving to The University of Arizona James E. Rogers College of Law.  Seeing your gifts support deserving students, fund research important to the profession and the people of Arizona, or sustaining the work of a great teacher are often far more satisfying reasons for giving.
 

The Giving Dilemma:

Take the example of Chris and Erin, alumni who wanted to establish a  scholarship that would help current students meet their law school expenses.  Chris and Erin, who owned several hundred shares of a highly appreciated technology stock, faced a choice:  Sell their stock and give the cash proceeds of the sale to establish the scholarship, or make a gift of the stock to the College of Law and let the College sell the stock and establish the scholarship in their name.  In the end, giving the appreciated securities to the College of Law proved to be a much wiser choice.

Chris and Erin's stock was purchased at $10.00 a share some years ago. The current value had risen to $36 a share. If they sold the stock themselves, they would have faced a taxable, long?term capital gain on the difference between their purchase cost and the proceeds from the sale ($36 minus $10 = $26 capital gain per share. 300 shares X $26.00 = $7,800 in capital gains).

Instead of selling the stock, Chris and Erin gave their 300 shares to the College of Law.  This gave them and the College of Law several clear financial benefits.  First, Chris and Erin avoided the capital gains tax altogether.  Second, they were able to deduct the current value of the stock (300 shares X $36 = $10,800) as a charitable gift.  And because they donated the stock instead of selling it and thus avoided the capital gains tax, the value of their gift to the College of Law was greater than it would have been had they sold the stock, paid the capital gain, and gave the remainder to the College of Law.  Finally, Chris and Erin received a greater tax deduction by giving the stock directly to the law college and avoiding the capital gain tax.

We hope that the example presented here suggests how tax-wise giving might benefit you and the College of Law.

For more information, please contact:
Janet Brauneis
Assistant Dean for External Relations
University of Arizona, James E. Rogers College of Law
PO Box 210176
Tucson, AZ  85721
(520) 621-8430