Publicly Traded Securities

A Tax‑Efficient Way to Give Now to Vitally Needed Ministries

Planned Giving has sometimes been called “deferred giving,” because many of the gifts we give from our accumulated assets are often deferred until after we have died (e.g. bequests through wills, life insurance, and charitable gift annuities). Such deferred gifts are often the most appropriate way to fulfill our philanthropic intentions. For example, if my concern is to provide for the church or sustain an important ministry far into the future, a deferred gift through my estate to a permanent or endowed fund makes perfect sense. But what if I want the church to receive my gift as soon as possible for a capital campaign or a mission project that is vitally needed now, not in some distant future? Is there a way that I can make use of planned giving strategies to achieve this goal? The answer is an emphatic, “Yes!” Gifts of publicly traded securities (stocks, bonds and mutual funds) are a simple and efficient way we can make a substantial gift to the church for its use now, while at the same time decreasing our out‑of‑pocket expense. Present tax laws stipulate that if we sell publicly traded securities, we are taxed on 50% of the capital gains. If we gift the securities directly to charity, however, we pay no tax on the capital gains while also receiving a tax donation receipt for the full market value of the securities. This means that the gifting of securities which have appreciated in value is a much more tax‑efficient way to give to the church than a comparable size gift of cash. You can direct the proceeds of your gift to go to your local congregation or to any ministry you choose within The Presbyterian Church in Canada.

You can use The Presbyterian Church in Canada’s stockbroker

If your congregation does not have its own stockbroker, you can use the services of The Presbyterian Church in Canada’s stockbroker to handle the transaction. You will receive a charitable receipt from The Presbyterian Church in Canada for the fair market value of the securities as of the date the church receives the securities. It is the policy of the church to sell the securities as soon as possible. The proceeds from the sale are then immediately directed to the ministries you want to support (e.g. your home congregation, PWS&D, a church camp, Presbyterians Sharing…, etc.). When your stockbroker holds your securities… Simply instruct your stockbroker to transfer electronically the securities you wish to donate to The Presbyterian Church in Canada’s brokerage account at BMO Nesbitt Burns. The process can normally be
completed within a week. The Planned Giving Office has simple transfer forms and guidelines to make the procedure as easy as possible.

When you hold the securities in certificate form…

This is a more complicated process than the electronic transfer of securities. You would need to bring the actual stock or bond certificate/s to the church’s brokerage. If you are using The Presbyterian Church in Canada’s stockbroker, you can go to any BMO Nesbitt Burns office in Canada. The staff will direct you on how to sign over the ownership of the security to the church. Alternatively, you could mail the stock certificates to The PCC stockbroker with a signed Power of Attorney form (we advise you use registered mail or courier in order to track your documents). Details and forms are available from the Planned Giving Office.

Special Note: Please inform the Planned Giving Office of your intent so that we can ensure that you receive the proper tax receipt and that your gift goes to the ministry you have designated.

Questions and Answers

Question: Can I direct the church not to sell my securities or to sell them only at a specified price?
Answer: No. It is the policy of The Presbyterian Church in Canada to sell securities as soon as they are in the hands of our stockbroker. This policy facilitates the transfer of the proceeds of the sale of the securities into the hands of your chosen beneficiaries as quickly as possible.

Question: Why is the amount of money the beneficiary receives different from my tax receipt?
Answer: The tax receipt is based on the market value of your securities on the day they are received by the church. Because the securities are sold on a later day than the date of receipt, they may fluctuate in value. Sometimes the sale price may be higher; sometimes the sale price may be lower. There is also a brokerage fee for selling the securities that is subtracted from the total sales price.

Question: Can I designate more than one beneficiary when I gift my stock?
Answer: Yes, you can identify various ministries including your congregation, but the beneficiaries must be ministries within The Presbyterian Church in Canada.

Case Study

Mrs. X wanted to donate money for a clean water project she read about in “Something Extra.” After talking with the Planned Giving Office, she learned about the tax efficiency of donating public securities. She had some CIBC stock that had appreciated in value over many years. She sent a transfer form to her broker, instructing him to transfer a portion of her holdings to The PCC broker. The proceeds from the sale were
directed to the project, and she received a tax receipt for the full market value of the stock. Mrs. X is delighted. Her CIBC stock is now providing fresh drinking water for a village in Malawi! She is planning on using her tax savings to make an additional donation to the capital campaign in her home congregation.

How to Make a Gift of Publicly Traded Securities

Download this one-page form. Complete it and make a photocopy. Give the original to your stockbroker, and return the copy (by mail or scanned and e-mailed) to the Planned Giving office. Questions? Call us at 1-800-619-7301, ext. 265.