Highs and lows: Reminding clients about stock gifts
by SCF Team | August 1, 2026 | Siouxland Community Foundation Blog, Advisor Resources
Clients are typically better off from a tax perspective when they donate appreciated stock held for more than one year instead of writing a check. The charitable deduction is generally based on fair market value, and the charity can sell the stock without triggering capital gains tax.
The nuance many clients miss is how that fair market value is calculated.
Suppose a client transfers 100 shares to a donor-advised fund at the Siouxland Community Foundation. On the date of the gift:
- High price: $82.40
- Low price: $79.60
- Closing price: $81.95
Clients may assume the deduction is based on the $81.95 closing price. Under Internal Revenue Code Section 170, Treasury Regulation § 1.170A-1(c), and the IRS valuation methodology in Treasury Regulation § 20.2031-2(b)(1), publicly traded securities are generally valued using the average of the highest and lowest quoted selling prices on the date of contribution:
($82.40 + $79.60) ÷ 2 = $81.00 per share
The difference may be small in some cases, but it can become meaningful for larger gifts or during periods of market volatility.
The valuation date also matters. The gift date is generally the date the transfer is considered complete for federal tax purposes, which can vary depending on how the securities are transferred and when control passes to the charity.
The Siouxland Community Foundation works with appreciated securities regularly and can help facilitate transfers, especially when year-end timing is critical. Reach out whenever a client is preparing to transfer stock.
The team at the Siouxland Community Foundation is honored to serve as a resource and sounding board as you build your charitable plans and pursue your philanthropic objectives for making a difference in the community. This blog is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. Please consult your tax or legal advisor to learn how this information might apply to your own situation.
