Giving During Volatile Times

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We are currently experiencing a difficult and challenging economic environment. Many are worried about their financial position and are uncertain if they will be able to give to the charities they support. When times are tough, the need for charitable services and programs grows. Endowment funds of various charitable organizations have suffered during the past couple of months. Our English-speaking charitable community organizations need our support more than ever before. With stable funding, organizations can better plan for the future and design programs with a greater impact, hence being a more effective organization.There are many benefits to donating to charitable community organizations; the donor can receive substantial tax benefits while knowing that their generosity is supporting projects and organizations that are important to them. And, the recipient organization will benefit during their greatest time of need. Please give and make a difference in your community – your contribution can provide long-term and stable sustainability to our community organizations.Example

Joe wants to donate his stock with a fair market value of $10,000 to a charitable organization. Originally, it cost him $2000.

His combined tax rate is 46.4%

Capital Gain ($10,000 – $2,000)$8,000

Taxable gain (0% of $8,000)               0

Tax on gain                                        0

Donation receipt                       $10,000

Credit                                       $ 4,640

If the stock were sold instead of being donated:

Sales proceeds                      $10,000

Capital gain ($10,000-$2,000)$8,000

Taxable gain (50%x $8,000)$4,000

Tax on gain (46.4% x $4,000)$1,856

If Joe sells his stock, he would have to pay $1,856 in taxes; however, if he donates his stock, he will receive a tax credit of $4,640.

DISCLAIMER This article provides general information about how charitable gifts may be made to charitable organizations serving the English-speaking community of the Greater Quebec City region. Every effort has been made to ensure that the information is accurate and up to date. Any examples presented are for purposes of illustration only. If you are considering a donation, you should consult a professional for independent advice on the best way to achieve your objectives.