How to Donate Appreciated Stock to Charity
- Welfare Fund Team
- Apr 6
- 4 min read
Donating appreciated stock to charity means transferring shares that have grown in value directly to a nonprofit instead of selling them first. You skip the capital gains tax on that growth, and you may deduct the full fair market value of the shares. For many donors, this approach puts significantly more money to work for the causes they care about than writing a check for the same amount would.
Most donors reach for their checkbook. It feels simple. But if you own stocks that have grown in value since you bought them, that instinct may be costing you, and the cause you care about, real money.
Donating appreciated stock directly to a nonprofit is one of the most tax-efficient ways to give. Financial advisors have recommended it for years. Most donors have never heard of it.
Here is how it works, why it matters, and how it can support the LA County firefighters and families served by the LA County Firefighters Welfare Fund.
What Appreciated Stock Is
Appreciated stock is any stock you own that is worth more today than what you originally paid for it. That difference is called a capital gain, and the IRS taxes it when you sell.
Say you bought $5,000 of stock ten years ago. Today it is worth $20,000. You are sitting on $15,000 in capital gains. Sell it, and you owe tax on that amount. For most long-term investors, capital gains tax rates run between 15% and 20% depending on income.
That tax reduces what you have available to give.
Why Donating Appreciated Stock Beats Writing a Check
When you donate appreciated stock directly to a qualified 501(c)(3) nonprofit, two things happen at once.
First, you avoid paying capital gains tax on the gain entirely. Second, you may deduct the full fair market value of the shares on the date of the gift, not just what you originally paid for them.
In the example above: that $20,000 in stock, donated directly, may generate a $20,000 charitable deduction. The capital gains tax on the $15,000 gain disappears. And the nonprofit receives the full $20,000 when it sells the shares.
Compare that to the checkbook route. Sell the stock, pay the tax, donate what remains. The nonprofit gets less. Your deduction is smaller. Everyone loses a piece.
A qualified tax advisor or CPA can help you understand exactly how this applies to your situation. This is a general overview, not tax advice.
How the Process Works With Our Charity
The mechanics are simpler than most people expect.
The LA County Firefighters Welfare Fund accepts stock donations through DonateStock, a secure third-party platform built specifically for this type of gift. You submit your brokerage credentials directly through their system. No phone calls. No paperwork back and forth.
Step 1: Go to the fund's DonateStock page and enter your brokerage information securely through their platform.
Step 2: Select the shares you want to transfer and confirm the gift.
Step 3: DonateStock handles the transfer on the back end. The fund receives the shares and sells them.
Step 4: Keep your acknowledgment letter for tax records. You will need it at filing time.
The whole process takes a few minutes. Your financial advisor can help you decide which shares make the most sense to donate.
Who This Strategy Works Best For?
Stock donations tend to make the most sense if you:
Own shares that have grown significantly in value
Hold those shares in a taxable brokerage account, not an IRA or 401(k)
Have held the shares for longer than one year, which qualifies them for long-term capital gains treatment
Plan to give anyway and want the gift to go as far as possible
If those conditions apply to you, it is worth a conversation with a financial advisor before year-end. The window closes December 31.
Why This Matters for the Fund
The LA County Firefighters Welfare Fund is a 501(c)(3) nonprofit. Stock donations are tax-deductible under federal law, the same as a cash gift, with the added benefit of eliminating the capital gains tax.
Every dollar that reaches the fund goes directly to firefighters and families when they need it most. When a firefighter is injured and income stops, the fund helps cover the gap. When a family faces a medical crisis, the fund is there. When a firefighter is lost in the line of duty, the fund shows up for what comes next.
Stock donations allow supporters to give more. The fund receives more. That is a good deal for everyone.
The Mission Behind the Gift
The LA County Firefighters Welfare Fund has stood behind firefighters and their families for more than 75 years. The fund is independent. It exists because the people who serve this community deserve real support when life gets hard.
A stock donation is one of the most powerful ways to stand behind that mission.
Ready to Give?
Donating stock to the LA County Firefighters Welfare Fund takes about five minutes. Visit our DonateStock page, enter your brokerage information, and the transfer is handled securely from there. Follow us on Instagram and Facebook to stay connected to the work.
***The LA County Firefighters Welfare Fund is a 501(c)(3) nonprofit organization, not a tax or financial advising firm. The information in this post is intended for general educational awareness only and does not constitute tax, legal, or financial advice. Tax laws change and individual circumstances vary. Please consult a qualified CPA, financial advisor, or tax professional before making any decisions about stock donations or charitable giving strategies.***
