8072 / Can an individual deduct the fair market value of appreciated real estate or intangible personal property such as stocks or bonds given to a charity?
Editor’s Note: The 50/60 percent AGI limits discussed below were increased to 100 percent for the 2020 and 2021 tax years in response to the COVID-19 pandemic.
If an individual makes a charitable contribution to a public charity of real property or intangible personal property, the sale of which would have resulted in long-term capital gain, he is generally entitled to deduct the full fair market value of the property, but the deduction for the gift is limited to the lesser of 30 percent of adjusted gross income or the unused portion of the 60 percent (50 percent prior to 2018) limit (see Q 9065).1 See Q 9068 for the rules that apply to gifts of tangible personal property, and Q 9069 regarding gifts to private foundations.
A deduction denied because it exceeds 30 percent of the individual’s adjusted gross income may be carried over and treated as a contribution of capital gain property in each of the next five years.2
Example: In 2024, Mr. Copeland had adjusted gross income of $600,000. He made a charitable contribution of long-term capital gain stock worth $200,000 to his church. His deduction is limited to $180,000 (30 percent of $600,000). In 2025, Mr. Copeland’s adjusted gross income is $700,000. He contributes $100,000 worth of long-term capital gain bonds to the church. He may deduct $120,000 in 2025 ($100,000 plus $20,000 carried forward from 2024), since the total does not exceed 30 percent of his adjusted gross income for 2025 ($210,000).