Investment Update

JUNE 2017


Your FP/CM Newsletter – 2Q17

VINCE MARSDEN, Partner, SVP of Financial Planning


The standard method of supporting our favored charities is to simply write a check, and then take the income tax deduction on our tax return. . However, a more tax-efficient approach for the donor, is to donate appreciated investment holdings (usually stocks), where you can use the current fair-market value of the investment as an income tax deduction, yet not have to pay capital gains taxes on the unrealized gain (the amount the investment has appreciated since you originally purchased it).

Those capital gains taxes can be as high as 23.6%. The illustration below assumes that a married couple, filing jointly, with an adjusted gross income in excess of $500,000 (federal income tax bracket = 39.6%), wants to make a significant charitable donation. They plan to use $50,000 of appreciated stock they own (that has a cost basis of $20,000) to fund the donation. The table below compares the results of the couple selling the stock in order to donate the cash proceeds to the charity, versus donating the securities directly to the charity instead.


Read More

“In the short-term, it is possible to make a lot of money from an advisor’s poor process — or lose a lot from a perfect one. Our clients look to us for a good process with a focus on the long-term. Smart investors recognize these differences before they commit wealth.”


— Aaron Cohen, President