The Israel Tax Authority issued an important ruling regarding the donation of shares that benefits donors and Israeli charities. The Tax Authority ruled that when shares are donated, donors will get a tax credit for the fair market value of the shares donated and will  avoid paying capital gains tax on the transfer of shares by the donor. Previously, the tax authority required donors to realize the unrealized gains on the donations as capital gain subject to 25% taxation.  The donor will be entitled to claim a tax credit of up to 35% of the value of the donation on their Israeli tax return. This is a win-win for both donors and Israeli charities

Behind this welcome initiative is JGive, which approached the Israel Tax Authority and asked for its help in encouraging donations, and making the process easier for the donor community in Israel and for Israel. JGive is a non-profit social organization that has developed an accessible technological infrastructure that allows donations to be transferred and managed easily to a variety of charitable organizations in Israel at the same time, and makes it easier for the donor to generate one inclusive receipt (approved for use by the Tax Authority) for all his contributions during the year.

U.S taxpayers who have appreciated stock in Israel, we recommend that you consider this option as well as discuss with our firm how this may impact your tax situation