Elimination of capital gains tax to encourage gifts
The federal budget had at least one piece of good news for charities today (perhaps this is the only piece of good news!). The government will completely eliminate the capital gains tax on gifts of appreciated securities to charities.
AFP, CAGP and other advocacy groups have been lobbying for this for many years. In 1997 the capital gains tax was lowered to 50% and many charities
felt the impact through more and larger gifts of stock.
If this is all confusing and new to you, be aware that it is more advantageous (for the donor) to give appreciated securities to your charity than it is for them to give cash. When giving securities, the donor saves on the capital gains tax and receives a tax receipt. It is important to let your donors (especially major donors) know about this option.
Further explanations and background can be found here:
Conservative Government Comes Through For Charities (from Drache LLP Tax, Estates & Charity Law)
AFP May 2, 2006 Press Release
AFP Canadian Federal Issues
Related Posts:
- Now every Canadian charity can accept stock donations
- Capital campaign trends, from the AFP international conference
- Federal budget: good news for private foundations
- The impact of matching gifts
- Donors give to keep names off and options open
