| |
Securities
Capital gain for The Ottawa Hospital Foundation
On May 2, 2006, the federal government eliminated the capital gains
tax on donations of publicly listed securities to public charities.
Therefore, you will not pay any income tax on the capital gain that
is triggered by your donation to The Ottawa Hospital Foundation.
In contrast, if the securities are sold and the cash is then donated
to the Foundation, 50% of the capital gain is taxable.
Real life example
In the example below, assume that the combined federal and provincial
tax rate is 46 percent and that the donor has made other charitable
contributions exceeding $200.
|
|
|
Sell securities and donate cash |
Donate the securities directly to
TOHF after May 2, 2006
|
| Fair market value
(FMV) of securities |
|
$10,000 |
$10,000 |
| Original cost of
securities |
|
$1,000 |
$1,000 |
| Capital gain (FMV
less original cost of securities) |
|
$9,000 |
$9,000 |
| Taxable portion of gain |
|
$4,500
(50% of capital gain
is taxable) |
$0
(0% of capital gain
is taxable) |
| Donation tax credit
(at 46%) |
|
$4,600 |
$4,600 |
| Tax payable on gain
(at 46%) |
|
$2,070 |
$0 |
| Tax savings (tax
credit less tax payable on gain) |
|
$2,530 |
$4,600 |
| Net cost of $10,000
donation (donation amount less tax savings) |
|
$7,470 |
$5,400 |
How to get started
Your securities can be transferred directly from your brokerage
account to the Foundation's account. You will receive an income
tax receipt for the fair market value of your donation. The fair
market value is based on the closing market price on the day that
the securities are received by the Foundation.
Our step-by-step
guide gives you the information you need to make a donation of securities.
We strongly recommend you consult with your financial advisor if
you are considering a donation of securities to the Foundation.
For more information, please contact Susan McIntosh, Planned Giving
Officer, at (613) 798-5555 ext. 19819 or by e-mail at sumcintosh@ottawahospital.on.ca.
|
|
