Gifts of Business Interests

A gift of a business interest is an excellent way for you to sell your business, save on taxes, create income for yourself and your loved ones and make a gift to support your favorite cause or our community in general.

As a business owner, you've worked hard to grow your company and provide for your family. You also have a unique opportunity to support the causes you care about through charitable planning. By giving corporate stock or business assets, you may receive valuable tax and income benefits—while making a lasting difference in the community.

Benefits of gifts of business interests

• Receive a charitable income tax deduction
• Avoid tax on the sale of your business stock or assets
• Receive lifetime payments if your business stock or assets are used to fund a planned gift

Gifts of business interests video

How gifts of closely held stock work

1. Give a percentage of your voting or non-voting shares in your business to us outright and receive an income tax deduction. We will hold your shares for a future sale or redemption and can use any dividends paid to support your favorite causes as you directed.
2. Give a percentage of your voting or non-voting shares in your business to a donor advised fund (DAF) and receive a charitable deduction. The DAF will hold your shares for a future sale or redemption and can use any dividends paid for charitable grants. On an annual basis, you can make grant recommendations from the fund to your favorite charitable causes.
3. If your corporation is an S corporation, there are special rules that apply to gifts of corporate stock. Please contact us to discuss the most tax-efficient way to structure your stock gift.

How gifts of business assets work

1. If your business makes a gift of a non-inventory asset, it will receive a charitable income tax deduction based on the appraised fair market value of the asset.
2. The income tax deduction for a gift from a business is limited to 10% of the corporation's taxable income. Your business may carry forward any unused deduction up to five years.
3. If your business is an S corporation, the charitable deduction will flow through to the shareholders in proportion to their ownership interest. Check with us on the most tax-efficient way to make a gift of corporate assets from your business.

Other considerations

Business Succession Planning—If you're preparing to sell your business, consider making a charitable gift before signing a binding agreement. By donating a portion of your business to the Washington County Community Foundation, you may be able to reduce—or even eliminate—capital gains taxes. Plus, the charitable deduction you receive can help offset taxes on the portion you choose to sell.

Tax-Smart Giving with a Charitable Remainder Trust—If you're looking to sell your business and also receive income, ask us about using a charitable remainder trust. You can transfer part or all of your business to the trust, which can sell the interest tax-free and then pay you (and your spouse) income for life. You'll also receive a charitable deduction to help offset any capital gains.

Contact us

If you have any questions about making a gift of a business interest or your business assets, please contact us. We would be happy to assist you and answer your questions.