What is the immediate tax deduction I can take when I donate stock or crypto?


When it comes to making charitable donations, Daffy offers a great option for a Donor-Advised Fund (DAF). If you're considering donating stock or cryptocurrency, Daffy allows you to take an immediate tax deduction for the full market value of the asset in the calendar year when the contribution is made. This is particularly beneficial if the asset has appreciated in value since its initial purchase, as you won't be responsible for paying capital gains tax on the gain. This can result in significant tax savings compared to selling the asset and donating the proceeds. For instance, if you bought a stock for $1,000 and it has now increased in value to $5,000, donating this stock to a charity through Daffy allows you to claim a charitable deduction of $4,000. This is the difference between the value of the stock when you bought it and its current value. Moreover, you can avoid paying capital gains tax on the $4,000 of appreciation. Donating stock or crypto through Daffy is not only tax-efficient but also convenient. Many charities are set up to accept stock or crypto donations, making the process as easy as transferring the assets from your brokerage account or crypto wallet to the charity's account. As the holiday season approaches, consider the potential tax advantages of donating stock or crypto through Daffy. By doing so, you can support the causes you care about and potentially save on your taxes at the same time. Always remember to consult your tax specialist to understand your specific situation when making a stock or crypto contribution. Happy holidays!

Please note that the information contained on this page is for educational purposes only and should not be considered tax advice. Any calculations are intended to be illustrative and do not reflect all of the potential complexities of individual tax returns. To assess your specific tax situation, please consult with a tax professional.

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