Gifts of Mutual Fund Shares

Gifts of mutual fund shares for funds invested in stocks and bonds are generally similar to gifts of securities. The donor transfers ownership to Lawrence and is entitled to an income tax deduction for the value of the shares on the date the college assumes control of them. The capital gain treatment of contributions of mutual fund shares is identical to that of individual securities. If the gift is outright, no capital gains tax is due. Because gifts of mutual funds generally require Lawrence to establish an account with the company administering the fund, extra time should be allowed for this kind of transfer.