Stock donations for nonprofits: How to prepare before the year-end rush

A donor wants to give $15,000 in appreciated stock before December 31. Your nonprofit is happy to accept it, but there's a problem. Nobody has the brokerage transfer instructions, and your finance team hasn't handled a stock gift before.

By the time everything is ready, the donor may have missed the year-end deadline. Your nonprofit can avoid this situation with a little preparation.

For nonprofits, stock donations offer another way to benefit from this year-end giving activity. They can also help eligible donors contribute appreciated investments without first selling them.

Here's what your nonprofit needs to have in place before those transfer requests arrive.

Stock donations for nonprofits at a glance

Stock donations involve more steps than ordinary online gifts. Your finance and development teams need to know what happens before, during, and after each transfer.

These are recommended planning dates for 2026, not IRS deadlines.

Can nonprofits accept stock donations?

Yes. Eligible U.S. nonprofits, including 501(c)(3) public charities, can generally accept stock and other securities as charitable contributions.

They don't normally need separate IRS approval to receive publicly traded stock. However, they need an appropriate receiving arrangement, a process for handling the shares, and accurate financial records.

Stock giving can also offer donors certain tax advantages.

For example, a donor purchased shares for $8,000 several years ago. Those shares are now worth $15,000.

If the donor sells them, the $7,000 gain may be subject to capital gains tax. If they donate the appreciated shares directly to an eligible public charity, they generally avoid recognizing that gain and may qualify for a deduction based on fair market value.

The tax treatment depends on the donor's circumstances, including how long they owned the securities.

The IRS explains charitable contribution rules in Publication 526.

Why stock donations matter more at year-end

Year-end is when many donors review their finances, charitable contributions, and tax planning before the calendar closes.

Stock gifts can be particularly relevant to donors with appreciated investments.

According to The Giving Block's 2026 Annual Report, online stock donation volume processed through its platform increased 127% from 2024 to 2025. Nearly 67% of the total value of these donations was received in December 2025.

For nonprofits, this creates a reason to include stock giving in year-end appeals rather than relying only on cash donations.

How do stock donations work for nonprofits?

A stock donation transfers ownership of securities from a donor to a charitable organization.

The process generally follows five steps:

1. The donor requests the transfer. They contact their broker and provide the nonprofit's receiving account information.
2. The securities arrive. The nonprofit's brokerage or receiving service confirms the transfer.
3. The gift is recorded. Finance documents the number of shares, security details, contribution date, and appropriate accounting value.
4. The nonprofit sells the shares. Nonprofit organizations sell marketable securities according to their gift acceptance policy.
5. The proceeds are reconciled. Finance matches the sale proceeds to the original gift and records any applicable gain, loss, or transaction cost.

The amount received from selling the shares may differ from their value when donated. That is important for accounting, but it doesn't automatically change the donor's charitable deduction.

First step: Decide what types of securities your nonprofit will accept

Before accepting stock gifts, decide which assets your nonprofit organization can reasonably manage.

Publicly traded stocks, ETFs, and mutual funds

These are generally the easiest securities to accept because market prices are available and the assets can usually be sold.

Publicly traded stocks and ETFs commonly move between brokerage accounts through the Depository Trust Company (DTC).

Mutual funds may require different transfer procedures. Some involve additional paperwork or coordination with the fund company.

Practical tip: Ask your receiving broker to confirm which securities it can accept and how each type should be transferred.

Restricted, privately held, and other complex securities

Private company stock, restricted shares, and certain partnership interests can be harder to transfer or sell.

They may involve ownership restrictions, legal approvals, appraisal requirements, or tax concerns. Your nonprofit should review such offers individually with qualified advisers before accepting them.

Remember, a potentially large donation isn't always beneficial if it creates substantial costs or obligations.

Second step: Create or update your stock gift acceptance policy

A gift acceptance policy gives your nonprofit clear rules for handling securities. It should address three main questions.

Which securities will your nonprofit accept?

Define the types of gifts your organization accepts routinely and those requiring additional review.

You can also state conditions for declining gifts, including unacceptable restrictions, unexpected liabilities, or high administrative costs.

Who approves complex gifts?

Routine stock transfers may be handled by authorized finance staff.

Private or restricted securities may need approval from a gift acceptance committee, executive leadership, or the board. Assign responsibility before a complicated offer arrives.

When will donated securities be sold?

Many nonprofits liquidate marketable securities promptly to reduce the risk of price changes.

Your policy should identify who can authorize a sale and how exceptions are approved. Any donor restrictions must be reviewed before acceptance.

Sample stock gift acceptance policy statement

Our organization accepts publicly traded securities that can be transferred to and sold through our approved brokerage account. Marketable securities will generally be sold promptly after receipt. Privately held, restricted, or other complex securities require review and approval before acceptance. The organization reserves the right to decline gifts that create unacceptable costs, restrictions, or liabilities.

Adapt this statement to your organization's circumstances and have the final policy reviewed by appropriate financial advisers.

Third step: Set up stock donations for your nonprofit

Choose how your nonprofit will receive stock donations

Direct brokerage transfers give your organization control over receiving and selling the shares. Your finance team handles the related tracking and records.

Third-party services may manage transfers and liquidation on your behalf. Before choosing one, review its fees, processing timelines, donor information sharing, and acknowledgment procedures.

A donor-advised fund (DAF) offers another route. Donors can contribute securities to the fund and later recommend a grant to your nonprofit. Your organization receives the grant rather than the original securities.

Confirm your nonprofit brokerage account

If receiving shares directly, contact your brokerage and verify that your account accepts incoming securities.

You may need your nonprofit's EIN, governing documents, IRS determination letter, and authorized signer information.

Ask about transfer restrictions, account fees, selling procedures, and the person your staff should contact when problems arise.

Prepare donor-ready transfer instructions

Donors need accurate information to initiate transfers.

Your stock giving instructions should include:

• Brokerage or custodian name
• DTC participant number, when applicable
• Exact receiving account name and number
• Nonprofit contact information
• Any special instructions for mutual funds or other assets

Have your receiving broker verify these details before publication.

Ask donors to notify you before transferring shares

Some securities arrive without identifying the donor. That can make acknowledgments and gift designations difficult to manage.

Create a simple notification form and ask donors to submit it when they request a transfer.

Sample donor notification

The information above is fictional.

Make it clear that submitting this form does not initiate the actual stock transfer. Donors must still instruct their brokerage.

Assign responsibilities and track unidentified gifts

Finance should monitor incoming securities, manage sales, and reconcile transactions.

Development should match transfers to donors, confirm gift designations, and prepare acknowledgments.

If unidentified shares arrive, review transfer references and contact the receiving brokerage. Keep the gift unidentified until its source is confirmed.

Fourth step: Prepare your stock gift acknowledgment and reporting process

Stock donations are noncash contributions, so their tax documentation differs from ordinary cash gifts.

What should a stock donation acknowledgment include?

For a charitable contribution of $250 or more, the donor must obtain a contemporaneous written acknowledgment to support the deduction.

The IRS requires the charity's name, a description of the noncash gift, and a statement about goods or services provided in exchange.

For stock gifts, it's helpful to include the donor's name, donation date, security name, number of shares, and your nonprofit's EIN.

Sample acknowledgment

Thank you for your generous contribution of 50 shares of XYZ Corporation common stock, received on December 15, 2026. No goods or services were provided in exchange for this contribution.

Why nonprofits should not state the donor's tax-deductible value

An acknowledgment for donated stock should describe the securities without assigning a tax-deductible dollar amount. The donor is responsible for determining and supporting the deduction.

Your nonprofit still needs to record the appropriate value for its own accounting purposes.

Know when Forms 8283 and 8282 apply

The IRS Form 8283 instructions establish reporting requirements for noncash charitable deductions.

• More than $500: Donors generally must file Form 8283.
• Publicly traded securities: These are generally reported in Section A, even when the claimed deduction exceeds $5,000. A qualified appraisal is normally not required.
• Nonpublicly traded securities: Donations with claimed deductions exceeding $5,000 generally require Section B of Form 8283. However, nonpublicly traded corporate stock valued at $10,000 or less generally does not require a qualified appraisal. This exception does not apply to every type of privately held security. When required, an authorized representative of the nonprofit must sign the Form 8283 donee acknowledgment. This signature confirms receipt of the property, not agreement with its appraised or claimed value.

Form 8282 may apply if a nonprofit disposes of certain donated property within three years.

Covered dispositions generally must be reported within 125 days. Publicly traded securities are normally excluded from this requirement.

Know when Form 990 Schedule M may apply

Organizations filing the full Form 990 generally must complete Schedule M when total noncash contributions exceed $25,000 during the tax year.

The threshold includes qualifying securities and other noncash property. Certain property contributions can also trigger the schedule regardless of the threshold.

Stock received and immediately sold still counts as a noncash contribution.

See the IRS Form 990 instructions.

Your nonprofit should provide factual information about its receiving process without offering personal tax advice.

When should donors start year-end stock transfers?

The earlier donors begin, the more time they have to resolve paperwork or brokerage delays.

Transfer requirements differ by asset type and financial institution.

These are planning recommendations, not guaranteed transfer periods or official IRS deadlines.

Why starting before December 31 is not enough

For donors using the calendar tax year, a stock donation generally must be legally completed by December 31, 2026, to qualify as a 2026 gift.

The date depends on how ownership is transferred. A pending brokerage request does not automatically count as a completed contribution.

Physical certificates and other transfer arrangements may follow different timing rules.

The IRS explains contribution dates in Publication 561.

What do actual transfer timelines look like?

Fidelity Charitable's 2026 guidelines provide useful examples:

• Publicly traded securities coming from another financial institution typically take around two weeks.
• External mutual funds typically take two to six weeks. Fidelity Charitable recommends initiating them by November 9, 2026.
• Control and restricted stock paperwork should reach Fidelity Charitable by December 1, 2026.

These dates apply to Fidelity Charitable's own receiving process. Your nonprofit's brokerage may have different requirements.

Promote stock giving before the year-end rush

Stock donations won't help your campaign if supporters don't know they're an option.

Start promoting them in November, when donors still have time to arrange transfers.

A few practical approaches include:

• Create a dedicated stock giving page. Explain the benefits, accepted securities, transfer steps, and contact details.
• Mention stock in year-end appeals. Add a short section alongside cash and recurring giving options.
• Contact potential stock donors directly. Invite conversations with donors who have expressed interest in noncash giving.
• Use GivingTuesday outreach. Include stock giving as an option for supporters planning larger year-end contributions.

Keep your message focused on the giving process, not promised tax savings.

Test your stock donation process before year-end

Before asking donors to transfer securities, walk through the complete process with your team.

Check that the brokerage details are accurate and that donor notifications reach the right employee.

Test how a gift would be entered into your accounting records, how shares would be sold, and how the acknowledgment would be prepared.

You can also arrange a small real transfer with a willing donor if appropriate. The goal is to identify problems before your busiest fundraising period.

Support your broader year-end fundraising with BetterWorld

Stock donations are a valuable addition to your year-end campaign, but giving shouldn't stop there.

With BetterWorld, your nonprofit can manage online donations, recurring gifts, peer-to-peer fundraising, auctions, and events from one platform.

BetterWorld's Free plan includes all fundraising tools, unlimited campaigns, and donor management with 0% platform fees. Standard payment processing fees apply, and donors can choose to cover them.

While your team handles stock transfers separately, BetterWorld makes it easier to collect other contributions and keep supporters engaged beyond December.

Give supporters more ways to contribute and make fundraising easier for your team.

Sign up for BetterWorld for free.

FAQs

1. Does a nonprofit need a brokerage account to accept stock?

Yes. A nonprofit generally needs a brokerage account or another suitable receiving arrangement to accept securities directly. Third-party stock-giving services can provide alternatives.

2. What types of securities can nonprofits accept?

Nonprofits commonly accept publicly traded stocks, ETFs, mutual funds, and bonds. Privately held or restricted securities may also be accepted after legal and financial review.

3. How long does a stock donation take to transfer?

Processing can take several business days or longer. Some externally held securities take around two weeks, while mutual funds and complex assets may take several weeks.

4. What is the deadline for a year-end stock donation?

For calendar-year taxpayers, the gift generally must be legally completed by December 31. However, starting a transfer before that date does not guarantee completion.

5. How should a nonprofit acknowledge a stock donation?

Send a written acknowledgment describing the security and quantity received. Include the contribution date and the required statement about goods or services provided. Do not assign a tax-deductible value.