LT stock donation to DAF not fully deductible and incorrectly classify as 50% AGI

[kshin123]

I have made a long term stock donation to Fidelity DAF in 2025. After I entered the entry on Donation form, TT25 Mac Premier only allowed cost to deduct citing sec 170b only allowing cost. And it's also classified under 50% AGI on Charitable Contributions Summary.

My understanding is that long term stocks are fully tax deductible and should fall under 30% AGI. Is there a bug on TT25 Mac Premier? How to I fix these 2 issues?

[MarilynG1]

TurboTax may have listed your DAF stock donation as a 50% contribution automatically as a default on the Charitable Organization Worksheet; however, if you're using TurboTax Desktop you can check the box for 30% directly on the worksheet.

There is an area in the interview where you can indicate this if you step through the section again, and whether the stock is appreciated from your Cost Basis is also a factor, as well as holding period.

Here's more info on Donating Stock.

@kshin123 

[kshin123]

@MarilynG1 The buttons you highlighted is for the type of charitable organization - 50% charity or non-50% charity. Fidelity DAF is a 50% charity organization. For reference, if I change it to an "other than 50% charity", TT Mac Desktop correctly categorized the donation as subject to 20% AGI limit.

Again, my issue is Fidelity DAF being a 50% charity organization and my stock donation should be (1) categorized as subject to 30% AGI limit and (2) the full FMV of the donation should be deductible. It's currently being categorized as subject to 50% AGI limit just like cash and only the cost (not full FMV) is deductible.

Can it be a TT 25 Desktop MacOS issue?

[kshin123]

I spent hours reverse engineering/doing elimination and finally found that TurboTax Desktop checked a check-box on form Schedule A, Line 12-A to treat "30% capital gain property contributions under IRC Sec 170(b)(1)(c)(iii)".

The Problem

TurboTax Desktop automatically checks the box on Schedule A, Line 12-A to treat capital gain property contributions under IRC Sec 170(b)(1)(C)(iii).

While this "Section 170(b) election" increases your deduction limit from 30% to 50% of your Adjusted Gross Income (AGI), it comes with a massive catch: It limits your deduction to the cost basis (what you paid) rather than the Fair Market Value (FMV).

How to Tell if You’re Affected

Check your Charitable Contribution Detail Worksheet. Look at Line 9:

• If it says: "Deduction is limited to cost when making Section 170(b) election" — TurboTax has opted you into the cost-basis deduction.

• If it says: "Current deduction is limited to 30 percent of adjusted gross income" — You are deducting the full Fair Market Value.

The Fix

If you want to deduct the full market value of your stock (which is usually the smarter move if the stock has gained value), you must manually uncheck the box on Schedule A, Line 12-A.

The software likely defaults to the higher AGI ceiling (50%) to maximize the amount you can deduct this year, but it fails to realize that for many taxpayers, deducting the full value at a 30% limit is far more beneficial than deducting only the cost at a 50% limit.

Hope this helps someone in this situation.

[bigasplaid]

Thank you!  This was so frustrating, and the TT desktop software was useless.  Why it doesn't do the calculation (all the data is there!) for you and at least suggest checking one or the other based on which one is advantageous is beyond me!  It's buried deep in the worksheet labyrinth and the software simply takes last year's selection and copies it over, didn't even bring it up in the interview in step by step.  Just assumed my tax situation is unchanged year to year.  Thank you again for saving me the $60 to have a TT 'expert' uncover the archaic  programming oversight in their software.