Your donation of stocks or other securities to Underground Railroad, Inc. may yield significant tax advantages to you and greater benefits to your community.
• Avoid capital gains tax on the sale of long-term appreciated securities
• Receive a charitable deduction for the full fair market value of long-term appreciated securities.
ESTABLISHING THE GIFT’S VALUE
The gift value of the securities is the average of their high and low prices on the date of the transfer. For mutual fund shares, the net asset value (NAV), at the close of business on the date of the gift, is used to establish the value of the donation.
Pursuant to IRS regulations, the effective date of the gift for valuation and charitable deduction purposes is the date the securities are transferred into Underground Railroad’s brokerage account or delivered in certificate form to Underground Railroad. If the transfer needs to be made by a specific date, please allow sufficient time for DTC transfer to take place.
EASY STEPS FOR TRANSFERRING SECURITIES
The rules for transferring stock, while not complicated, are strict. If giving mutual fund shares, you should work with your broker or mutual fund and Underground Railroad to have the shares re-registered in Underground Railroad’s name. The following are methods, in order of preference, of transferring stock to Underground Railroad:
SECURITIES HELD BY A BANK OR BROKER
STEP 1: Complete your pledge form.
STEP 2: Authorize your broker or financial consultant to transfer the stock as a contribution to Underground Railroad (see the sample letter). Be sure to include the following information:
• Stock name or symbol
• Number of shares you wish to donate
• Expected date of transfer
• Your account #
• Name of your employer
• Your work and home telephone numbers
• Your home address
Brokerage Account: Merrill Lynch, DTC# 8862 – Account # 696-02686
STEP 3: For acknowledgement purposes, Underground Railroad must receive the above information. It is important that you specifically authorize your broker to disclose to Underground Railroad your name and details pertaining to the stock transfer. This step is particularly critical since privacy laws prohibit brokers from disclosing the names of clients making wire transfers of stock unless the disclosure of such information has been specifically authorized.
Please send the information to Christi Birchmeier, Executive Director, via email at email@example.com;
fax at (989) 399-0010; or mail to 5647 State Street, Suite A, Saginaw, MI 48603.
SECURITIES HELD IN CERTIFICATE FORM
STEP 1: Complete your pledge form.
STEP 2: Send your certificate without any endorsement to Christi Birchmeier at 5647 State Street, Suite A, Saginaw, MI 48603
STEP 3: In a separate envelope, send a blank Stock Power (fill in only the signature(s) and the date at the bottom) along with a copy of the letter that was mailed with your certificate to Underground Railroad. The certificate is only negotiable when joined with the Stock Power.
Stock power forms may be obtained at any bank or broker’s office. The gift becomes effective on the date you mail the certificate and Stock Power. You may hand deliver the certificate to the Underground Railroad’s Administrative Offices, where you can sign a Stock Power form. If the certificates are in your name, it is not recommended to have them re-registered in Underground Railroad’s name, as this process may take four to eight weeks.