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Stocks and Securities
Diocese of Oakland
Charitable Contribution Administrative Policy
SECURITY DONATIONS
Charitable
contributions may be received by parishes in many different
forms. Cash, real estate, and securities are but a few of
the forms that charitable donations may now take.
Following
is a policy for the receipt of gifts in the form of negotiable
securities, stocks, bonds, mutual funds or equities.
In
the event of a potential donation of securities, the Diocese
of Oakland has established a special account with Charles
Schwab to liquidate such gifts on behalf of the designated
recipient and a procedure to associate the gift with the donor
- a very important part of the transaction. All gifts of securities
to a parish or school are to be made through the Diocese and,
ultimately, through this account. The reason for this is that
the Roman Catholic Bishop of Oakland, a Corporation Sole is
the legal owner (taxable entity) of all property in the Diocese
and, likewise, of any donated funds that might be received.
It is, therefore, the Diocese of Oakland that must handle
stock transfers on behalf of the Parish. On receipt of the
gift, Charles Schwab will be instructed to immediately sell
those securities and forward the proceeds to the designated
recipient through the Diocesan Finance Department.
Procedure:
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Donor's
should be instructed to use the attached form to send instructions
to their broker for all stock transfers. It contains all
of the information a broker requires to complete the transaction.
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The
precise dollar value of a stock gift can not be determined
until the securities are received and sold by the Diocese
(donor, however, assumes a value equal to the market on
the date of transfer - See IRS Publication 526 for further
details - exerts of which are attached as Addendum I) Therefore,
if the donor elects to allocate dollar amounts to various
end uses, the donor will need to designate one of those
amounts to be the remainder account by circling it on his
letter. The circled account will receive the balance left
after other designated amounts have been allocated. Or,
the donor may designate percentages of his gift to each
end use. Where multiple entities (i.e. more than parish,
school or charitable organization) are involved, the allocation
of funds will be handled at the Diocesan level per the instruction
of the donor.
-
In
addition to providing a copy of the attached to the Donor's
Broker, copies of the attached form should be sent by fax
to (1) the Diocese Development Director (to alert her to
the pending receipt of a stock gift for the benefit of a
particular parish, (2) the Diocesan Controller, to alert
him to the pending receipt of gift stocks in the Charles
Schwab account, and (3) to the Pastor or business manager
of the designated recipient/parish so that when funds arrive
from the Diocese of Oakland proper allocation of the funds
(e.g. to Diocesan Savings) will be expedited.
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The
names & fax numbers of the Development Director and Diocesan
Controller responsible for seeing to it that these transactions
are handled properly follow:
John Neudecker
Director of Development
Diocese of Oakland
(510) 267-8314
FAX (510) 446-7429
Paul Bongiovanni
Finance Department
Diocese of Oakland
(510) 267-8321
FAX (510) 893-0945
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It
may take several days after the donor has instructed his
broker, before the securities are transferred to Charles
Schwab. It takes yet another three to four working days
for the trade to settle, when the proceeds of the sale actually
arrive in the Diocesan account. If there are no unusual
circumstances and everything is in order, the securities
are generally sold on the day of receipt or the next working
day, at the "current" market price (not necessarily the
market value on the date that transfer instructions were
initiated by the donor).
-
Once
the Pastor or business manager at the parish receives the
check from the Diocese of Oakland finance department, the
money may then be deposited into Diocesan Savings or allotted
directly to the use designated by the donor.
-
The
parish Pastor or business manager must (in order for the
donor to receive the charitable deduction) then acknowledge
receipt of the donation - with the understanding that value
is established by the donor on the date notification is
given to the broker to transfer securities to the parish
or diocese, not the date of settlement. In other words,
it is not the role of the recipient of donated securities
to verify their value to the donor but simply to acknowledge
receipt of "X" shares of "XYZ" company for purposes of "XXX"
on the date of settlement. (An example is attached as Addendum
II).
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