Don't Let Your Tax Savings Turn into a Pumpkin at Midnight

Remember Cinderella’s magical evening at the ball?

Everything was perfect until the clock struck midnight. In an instant, her carriage turned back into a pumpkin, and her opportunity disappeared.

Year-end giving isn’t quite as dramatic, but it does come with an important midnight deadline of its own.

When the clock strikes midnight on December 31, the opportunity to claim charitable tax deductions for the 2026 tax year disappears. That is why now is the perfect time to make a tax-smart gift that supports Presbyterian Senior Living and/or the community you call home.

The Midnight Countdown Is On

As New Year’s Eve approaches, many donors are taking one final look at their finances and charitable goals. One of the smartest ways to give may be right in your investment portfolio.

A Fairy Tale Ending for Appreciated Securities

If you’ve owned appreciated stocks, bonds, mutual funds, or other securities for more than one year, donating them directly to PSL or your community may provide significant benefits:

• Receive a charitable deduction for the full fair market value of the asset

• Avoid paying capital gains taxes on the appreciation

• Support a fund that means the most to you

It is a gift that can help maximize your impact while potentially reducing your tax burden.

Tip: When donating stock, consider choosing securities with the highest appreciated gains that you've held for longer than one year.

See the Magic for Yourself

Let’s look at an example of how this tax-wise giving strategy works.

Imagine you purchased 15 shares of Microsoft stock in July 2020 for $788.85 per share. By October 2026, those same shares had grown in value to approximately $3,139 each, representing a gain of about $2,350 per share.

You may be considering selling the stock and donating the proceeds to support PSL or your community. After all, you can still make a charitable gift and receive a tax deduction.

But wait, Cinderella! If you sell the stock yourself, you will likely owe capital gains tax on the appreciation. At a tax rate of up to 20%, that could mean paying approximately $628 in taxes per share. After taxes, only about $1,722 per share would remain available for your charitable gift.

However, when you donate the appreciated shares directly to PSL/your community, neither you nor PSL/your community pays capital gains tax on the appreciation. PSL or your chosen community receives the full value of the stock, approximately
$3,139 per share, and you may be eligible to claim a charitable deduction for that full amount.

That is more support for the mission you care about and potentially greater tax benefits for you. In this scenario, the difference could mean more dollars invested in residents, team members, community enhancements, and programs that enrich lives throughout PSL.

Now that’s a happily-ever-after worth celebrating.

Before the Clock Strikes Twelve

Unlike Cinderella’s carriage, gifts of securities don’t transform at midnight, but the tax advantages can disappear if transfers aren’t completed in time. Keep in mind:

• Stock transfers may take several business days

• Mutual fund transfers may take several weeks

Planning ahead helps ensure your gift qualifies for an income tax deduction this year.

Don't Let Midnight Catch You by Surprise

As you prepare to welcome the New Year, consider making a year-end gift before December 31. Cinderella’s magical carriage turned back into a pumpkin at midnight, and while your carriage is safe, the opportunity to take advantage of potential tax benefits this year disappears after 11:59 p.m. on December 31.

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For more information or electronic transfer instructions, please contact:

Bethanie Constant
VP Mission Support
717-601-0626
bconstant@psl.org

As always, please consult your legal, tax, and financial advisors. This information is not intended as legal, tax, investment, or financial advice. Please notify the Office of Mission Support team member noted above of your intentions, so your gift can be properly identified, allocated, and acknowledged.