Donating Complex
Assets
Donating Complex
Assets
We are able to manage donations of any type of complex asset. This allows donors to maximize their tax benefits while also providing more flexibility to support the causes they care about.
We are able to manage donations of any type of complex asset. This allows donors to maximize their tax benefits while also providing more flexibility to support the causes they care about.
OUR PROCESS
How it Works
01
Donate
Ownership of all or a portion of the
asset is transferred to UI through a
Gift Agreement.
02
Sale
When the donated asset is sold, the
pro rata portion of the sale proceeds
go to the Charitable Fund (typically
a DAF).
03
Grant
The donor can then recommend
grants that are sent from the
charitable fund to support causes
they care about.
SAVINGS
Tax Benefits of Donating
Complex Assets
Eliminates capital gains taxes on the
portion of the asset that is donated.
Qualifies for an immediate personal income
tax deduction for the fair market value of
the asset.
CASE STUDY
Without Charitable Bunching
A family that wants to be charitably active in retirement is selling their debt-free business for $10 million. Their taxes include a 20% capital gains tax and a 7% state tax, totaling 27%. Their financial advisor suggests donating $2 million of the equity into their DAF to help accomplish their philanthropic goals.
2 Possible Scenarios
The family sells the business then uses money from the sale proceeds to give to charity.
The family donates a portion of their ownership stake to a DAF ahead of the sale.
Donation After Sale
Donation Before Sale
Sale Price
$10,000,000
$10,000,000
Donation Prior to Sale
$0
$2,000,000
Cost Basis
$100,000
$100,000
Taxable Amount
$9,900,000
$7,900,000
Taxes
$2,673,000
$2,133,000
After Tax Equity
$7,327,000
$5,867,000
Donation After Sale
$2,000,000
$0
Final Equity
$5,327,000
$5,867,000
Gift Tax Deduction
$2,000,000
$2,000,000
Income Tax Savings @44% TB
$880,000
$880,000
Final Equity Plus Tax Savings
$6,207,000
$6,747,000