Bigger Tax Rewards for Your Generosity - Special Tax Breaks for Gifts of Property

Facebook founder Mark Zuckerberg made news recently by promising to give away 99% of his net worth, including his Facebook shares, to charity. The arrangement takes advantage of a unique tax break for charitable gifts of appreciated property, such as stock.

Background: If you have held property long enough for it to qualify for a long-term capital gain if you had sold it—in other words, more than one year—you can deduct an amount equal to the property’s fair market value (FMV). On the other hand, if the property would not qualify for long-term capital gain treatment on a sale, your deduction is limited to your basis in the property, which is often its original cost.

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