Appreciated investments still provide tax benefits in turbulent stock market

Despite the turbulent market conditions, investors holding onto appreciated investments can still take advantage of tax savings by donating it to the endowment fund of their favorite Catholic cause.

Appreciated Investments Include Stocks and IRAs

Options may include gifts of appreciated stock, required minimum distributions (RMD) from their IRA that become a qualified charitable distribution (QCD) for donors 70.5 or older, gifts from a donor advised fund and inclusion of a Catholic organization in a will.  All of these methods can create a forever opportunity for Catholic organizations and a tax benefit for the donor, too.

In 2021, donor IRA mutual fund retirement accounts grew by 4%, with required minimum distributions growing by an average of 20%. Donor advised funds grew at a similar level.  

Tax Savings While Supporting Your Favorite Catholic Causes

The Catholic Foundation of Eastern Pennsylvania is encouraging donors to take advantage of the tax savings and help build up endowment funds for their favorite parish, school or Catholic ministry.

“Although the market conditions are rough right now, people may have investment holdings that have grown significantly during the past few years,” said Tom Scalici, vice chairman of the Catholic Foundation’s board and CEO of Cornerstone Advisors Asset Management.  “The timing is always right for donors to gain a tax advantage and support their favorite Catholic cause at the same time.”

Scalici cites many advantages for donors and Catholic organizations: the donor receives a tax benefit, their gift lives forever and provides ongoing income for their favorite Catholic cause and the Catholic organization becomes more fiscally stable.

Donors have the choice of making a gift to an already existing endowment fund or creating a new one to benefit a Catholic organization. Two years ago, a Berks County couple started the John Paul II Center Teacher Excellence Endowment Fund to recognize the outstanding work and tireless efforts of the classroom teachers and teacher aides at the school. Their gift came through appreciated securities. Visit CatholicFoundation.org to learn more about starting a fund.

“Our promise is simple,” Pete Waldron, President of the Catholic Foundation, said. “We want to make sure Catholic causes build healthy endowment funds to generate future income so they may fulfill their missions forever.”