What to Give
Gifts of Cash
The simplest way to make a gift to WKU is online at www.wku.edu/makeagift. You may also write a check to the WKU Foundation. When you itemize your deductions, your gifts of cash may be deducted on your federal income tax return. Amounts up to 50 percent of your adjusted gross income may be deducted during the year of the gift, with any excess deductions carried forward for up to five additional years. Your actual savings depend on your tax rate and other factors. Generally, the higher the tax rate, the greater your savings. Cash gifts are considered transferred on the date they are hand-delivered or mailed. For example, although a year-end gift might not be received until January, it is still deductible for the previous year if it has a December postmark.
Gifts of Appreciated Securities
Giving stocks and bonds that have increased in value provides even greater tax benefits than gifts of cash. The market value of the securities is deductible (subject to applicable limitations), and you also avoid paying capital gains tax on the appreciation. You may generally deduct gifts in the form of appreciated property up to 30 percent of your adjusted gross income with any excess deductible over the next five years.
Gifts of Closely Held Stock
In some situations, a donor may wish to make a gift of stock in a closely held corporation. If you own highly appreciated stock in a company that has significant cash reserves, this may be the best way for you to make a sizeable gift. When closely held stock is gifted, the donor is usually entitled to receive a charitable income tax deduction for the appraised value of the stock, in an amount up to 30 percent of adjusted growth income. Like gifts of appreciated securities and cash, any excess may be carried over into the next five years. This gift is beneficial because it allows the donor to make a gift without realizing capital gains tax on the appreciated value of the stock, and it allows the corporation to use a potentially taxable cash surplus for philanthropic purposes.
Gifts of Real Estate
A gift of real estate can consist of almost any type of property: a primary residence, a vacation home, a farm or ranch, a commercial building, subdivision lots or an undeveloped parcel. Such a gift will provide a charitable deduction for the full fair market value of the gift up to 30 percent of your adjusted gross income if you have held it for more than one year. The usual five-year carry-over also applies.
Through various methods of managing property and arranging for its distribution to family and others, you can minimize taxes and worries for your heirs. You may also be able to arrange a supplemental income for retirement through a charitable trust as part of your gift, or give a home while continuing to live there.
You will need to have your gift of real estate appraised by an independent appraiser to determine the value of your deduction, and you should first consult with the WKU Foundation to make sure your real estate is appropriate to the needs of the University.
Gifts of Objects
Donations of artwork, books, equipment and antique furniture are sometimes appropriate gifts to WKU. Before making a gift of tangible personal property, however, please consult with the University to confirm your gift can be used as you wish while also meeting the needs of WKU. If your gift is valued at $5,000 or more, you must have an independent appraisal within 60 days of the gift’s transfer to WKU to determine the value of your deduction.
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