Items you will need
- Brokerage statements
- Stock transfer form
If you want to help out a friend or family member in need, or your favorite charity, giving the gift of stock makes a lot of sense. Giving accumulated stock instead of cash can have tax advantages for both the donor and the recipient, and when you give stock, you also give the opportunity for further appreciation of the asset. But whether you plan to give your stock to a charity or an individual, it is important to follow the proper procedures to avoid problems with the Internal Revenue Service.
Check your brokerage statement for information on the original purchase price of the stock. If you do not have the original trade confirmation, contact your broker, who can help you work out the cost basis of the stock.
Contact your brokerage firm and let the customer service representative know that you plan to give the stock to a charity or individual. Be sure to let the representative know which stock you plan to transfer and how many shares are involved.
Ask the representative for a stock transfer form. In some cases, the form may be available on the broker's website. In other cases, the brokerage firm will mail the form to you.
Fill out the transfer form completely. Be sure to record the name of the recipient exactly as it appears on the individual or charity's identification. This will reduce processing time and eliminate confusion.
Write a letter detailing your instructions and include it with the stock transfer form. Contact the charity to get the address to send the completed form to.
Make copies of all your documents, including the completed stock transfer form and the letter. Keep these documents in a safe place, then follow up with the charity or individual to make sure your gift was received.
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