Once Friends of Bermuda Community Foundation accepts your contribution, you are eligible for a federal tax deduction up to the maximum amount allowed by law. Donors are advised to take note of the IRS guidance on 'quid pro quo, - www.irs.gov/charities and enter "4221-PC" in the search box.
The following provides general guidelines on the allowable federal tax deduction values for various asset types. The guidelines may not apply to your contributions, and you must consult your own tax advisor to determine the amount of any federal or state charitable deduction available to you.
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Your Contributed Asset Type
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· Your Generally Allowed Deduction Value
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Cash equivalent assets
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· The exact dollar amount of your contribution.
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Publicly-traded securities
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· Securities held for more than one year – The fair market value on the date the contribution is received by Friends of Bermuda Community Foundation.
· Mutual fund shares held for more than one year – The closing price on the date the contribution is received by Friends of Bermuda Community Foundation.
· Securities or mutual funds held for one year or less – The lesser of the cost basis and the fair market value.
Note: For securities contributed to a Fund account via a depository trust company (DTC), the value of the securities is calculated on the day they are deposited into the Fund account.
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Non-publicly traded securities
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· Securities held for more than one year – The fair market value on the date the contribution is received by Friends of Bermuda Community Foundation (Donor is responsible for obtaining the appraisal).
· Securities held for one year less – The lesser of the cost basis and the fair market value.
Note: If the fair market value is in excess of $4,000, the IRS requires an appraisal by a qualified professional in lieu of a fair market value determination.[1]
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Real estate
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· Real estate held for more than one year- The fair market value on the date the contribution is received by Friends of Bermuda Community Foundation (Donor is responsible for obtaining the appraisal).
Note: If the fair market value is in excess of $5,000, the IRS requires an appraisal by a qualified professional in lieu of a fair market value determination.[2]
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This information addresses Federal taxes only. Because State tax laws vary with regard to itemizations, and Federal and State tax laws impact each donor and his or her individual situation differently, we recommend you consult a tax and / or legal advisor to determine your allowable charitable contribution deductions. Donors may not rely on the guidelines provided above.
[1] Friends of Bermuda Community Foundation is not responsible for the valuation of non-publicly traded securities or real estate contributions. The sole responsibility for valuation, or determining if a third party valuation is required, lies with the Donor and any qualified professional they may name. The Fund will not be held responsible for any discrepancies in valuation that may arise during IRS or State investigations. The Fund only reviews and accepts contributions based on the policies outlined in the Guide.
Once Friends of Bermuda Community Foundation accepts a contribution, the Donor of Record (and, if applicable, the additional donor) will receive a written receipt indicating the value of any cash contributions and a description of any non-cash contributions.
We recommend you consult a legal and / or tax advisor when determining Federal and State charitable gift contributions for the most current information given your situation.
Contributions made to your Donor Fund are the sole property of Friends of Bermuda Community Foundation. Any income, if applicable and if at all, is subject to the terms and conditions of your Fund Agreement. Therefore, you may not take any additional charitable deductions on accrued income or growth. Any investment income is not subject to taxation.
You may receive receipts for approved grants you recommended to the Board for approved charities. Those receipts may not be used as an additional tax deduction claim. Grants from your Fund account are not eligible for additional tax deductions.
Any earnings related to a contribution are not part of your taxable estate and therefore are not subject to probate. Amounts contributed to your Fund account should not be included in your gift and estate tax unified credit calculation.
We recommend you consult a legal and / or tax advisor to determine how to consider your Fund account when conducting estate planning and how tax rules apply to your situation.