If you own appreciated securities (stocks, bonds or mutual funds held by you for more than one year), donating them to the Foodbank will allow you to reduce or avoid more capital gains taxes and receive a federal income tax charitable deduction. You can also designate the Foodbank as the beneficiary of your securities by consulting your broker. This type of gift can be especially appealing if you are holding shares that have appreciated significantly in value but yield a low dividend.
Similarly, if you have excess life insurance, you may enjoy tax benefits by designating the Vermont Foodbank as the beneficiary of an existing life insurance policy. In order to deduct premium payments as charitable deductions, the donor must name the Foodbank as both owner and beneficiary of the policy.
At a person’s death, qualified retirement plan assets may be subject to both estate tax and deferred income tax, which combined can exceed 80 percent. You can designate the Foodbank as a tax-free beneficiary of the remainder of your IRA, Keogh, tax-sheltered annuity, qualified pension or profit-sharing plan. A charitable gift of insurance proceeds or the remainder of retirement plan assets is normally deductible from a donor’s estate.