Friday, August 22, 2008

Sale of Anheuser-Busch a Boon for Charity?

Press reports coming from Missouri give a glimpse into the operations and mindset of charitable fundraisers. This story in the St. Louis Post-Dispatch notes that charities are blitzing owners of A-B stock with information about the tax advantages of stock donations. As most readers will know, A-B recently agreed to a buyout by In-Bev, a Belgian company. The buyout is structured as a cash deal, which is going to result in a lot of capital gains taxes on A-B shareholders. Of course, as the charities note, if one is philanthropic-minded, one can contribute that stock to the charity of one's choice before the closing date and take a deduction for the full fair market value of the stock without paying any associated capital gains taxes. Even with the low capital gains rates in play today, that's a significant tax savings. Another story notes that cash acquisition deals such as the A-B/In-Bev buyout are known as "liquidity events" in philanthropic circles . . .


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A "liquidity event" is the language of high finance; what's interesting & telling is that charities are becoming fluent in that lingo.

Posted by: jpe | Aug 22, 2008 6:53:16 AM

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