Entering appreciated stock donation to a Donor Advised Fund in Turbotax

Forum|Forum|5 years ago
March 3, 2021
3 replies
11 views

Could you please explain step by step how I enter an appreciated stock donation to a Donor Advised Fund in Turbotax Premiere?

DaveF1006

Level 15

Yes, here is how you will enter. If in Turbo Tax online.

Federal>deductions and credits>see all tax breaks
Go to charitable donations>Donations to Charity in 2020>Start
Say yes on the next screen when it asks if you made charitable donations. You will say yes.
The next screen you can add money and Mileage and travel expenses
The Donor Advised Stock fund is like money so you will select Stock.
Then answer the questions regarding your donor advised stock.

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NMtaxpayerAuthor

Level 2

Thanks for the reply. I think I am more stuck on the 1st question below, and if that answer is something other than "No", I'd have questions with the following numbers below as well. Thank you!

1. The first question I'm seeking help with is whether or not "I attached conditions on a donation" (such as "specified how the donation should be used", "allowed someone other than the charity to receive income from the donation"). If I should select "No", I could just enter as a donated stock and I'm good to go. But if I did, I need to enter the donation as an "item" and there are other questions I wonder how I should answer such as:

2. Did I restrict, temporarily or permanently the use of the stock donated to Fidelity Charitable? (I would think no)

3. Did I place restrictions limiting the stock I donated to Fidelity Charitable to a particular use? (possibly yes since I can choose which 501c3 it could go to?)

4. If yes to 3, Describe the special use restrictions: (not sure what I would put here)

5. Describe the physical condition when donated: excellent :happy

6. Does this item need an appraisal: Hope not

7. Amount received from bargain sale: Leave blank

8. Enter average trading price: I assume this the FMV of all the shares as stated on Form 8283

9. Enter the donation type: 30% charity I assume

Thanks for any additional insight

DaveF1006

Level 15

Yes, if you are certain you do not have those restrictions that are prescribed above, IRS wants to know this because they want to be reasonably assured that you had all rights to assign ownership rights to the charity.

Yes, all donor advised funds are to be donated to 30% charities.

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gem_tax

Level 2

In 2021, we created a donor advised fund (DAF) from our brokerage account. Over $14,000 was transferred from our brokerage account into the DAF.

"Donors receive an immediate tax deduction of up to 30% of adjusted gross income (AGI) for gifts of appreciated securities, mutual funds, real estate and other assets, and can enjoy five-year carry-forward deduction on gifts that exceed AGI limits."

Where does the immediate tax deduction come from?

In Turbotax, I had to enter a cost basis for the DAF in the charities section which lowered the $14,000 amount to just the cost basis ($1500) . This brought us back to the standard deduction from itemizing. Is this the right way to do this? The IRS says to use from 8283 for non-cash charitable contributions which TurboTax did not have us do.

GeorgeM777

Level 11

It could be. There are limitations if the donated stock was held one year or less. How long have you held the stock that you transferred to the donor advised fund? Moreover, because charitable deductions are itemized, if your standard deduction is greater than your itemized deductions, TurboTax will default to applying the standard deduction.

@gem_tax

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gem_tax

Level 2

The mutual fund Purchase Date was 8-4-2011 - Purchase Price $61.64/share - Total Purchase Cost $2157.67.

The mutual fund went into the DAF in November 2021 in the amount of $14,000 in the charitable contributions section in Turbotax. This initially lowered our taxes owed in Turbotax but then I was asked to enter the cost basis, which kicked us back to the standard deduction. Does the Donor Advised Fund go into the charitable contributions or elsewhere like form IRS Form 8283? Please help.

jerfong

Level 2

I donated appreciated stock to DAF. The donated stocks showed up in my 1099-B as sold and report capital gain. How do I complete the TT screen from Wages & Income>Investment Income>Stocks>? After several screens, one pops up for "Select any less common adjustments that apply." I think I should select "Some (or all) of the proceeds do not belong to me". Is that right? I know I have to complete Sch A for the charitable deduction.

Thanks!

KlisterKid

Level 2

Schwab's confirmation statement for me in 2021 had this information:

The tax deduction for donating shares held for more than one year is generally the fair market
value of the shares on the date of the contribution. The deduction for donating shares held for one year or less is generally limited to the lower of cost basis or the fair market value on the date of contribution. Please consult your tax advisor for specifics on your own tax situation.

IMHO: gain or loss does not matter; it's just the dollar value of your contribution.