ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Monday, April 21, 1997 TAG: 9704210095
SECTION: MONEY PAGE: 6 EDITION: METRO
COLUMN: MONEY MATTERS
SOURCE: MAG POFF
Q: I read that May 1 is the deadline for contributing appreciated stocks and bonds to a charity and taking a deduction for the full market value. Is this true?
A: You are onto something, but the change in the law is not as drastic as you make it sound.
At stake is the law that permits anyone to contribute securities to a charity and deduct the full market value at the time of the gift instead of deducting the price paid. For instance, you might have paid $5,000 for some stock and watched its value increase to $8,000 in the recent bull market. Even though you paid only $5,000, you can give the stocks to a charity and deduct $8,000. You will never pay capital gains tax on the $3,000 gain. The charity gets the full market value. You avoid the capital gains tax and get an $8,000 deduction. Only the Internal Revenue Service loses.
Neil Birkhoff, an estates and tax specialist with the Roanoke law firm of Woods, Rogers and Hazlegrove, said the law will change slightly next month. The effective date, however, will be May 31, not the first of the month.
The change, Birkhoff said, is that you will no longer be able to make such a gift to a private foundation, such as a family foundation. He said the law does not affect a public charity such as Center in the Square or the Salvation Army. You will still be able to donate appreciated stocks and bonds to a public charity, he said. Few people have private foundations.
Charles Equi, a certified public accountant with the Roanoke firm of Budd, Ammen and Co., said you can deduct such gifts up to 30 percent of your adjusted gross income each year. If you recognize the capital gain, on the other hand, you can deduct a gift up to 50 percent of your adjusted gross income.
Q: I have found a savings passbook from the old First and Merchants National Bank of Radford. My father opened the account for me in 1947 about the time I was born, and there has been no activity since that time. The account does not have much money, but I would like to claim it. What happened to the F&M Bank?
A: The First and Merchants National Bank of Radford was acquired in 1981 by United Virginia Bank, which later changed its name to Crestar Bank. But no business is required to maintain records that are 50 years old.
State law requires banks and other businesses to turn over any dormant funds to the state, which deposits the money in the Literary Fund, a source of loans used for school purposes. This process is called escheat. The money, however, can still be claimed by the owner or the heirs if they can prove it belongs to them.
Records are sketchy, however, for before the mid-1960s. And, in the past, compliance was not enforced as it is today. Still, banks generally complied with the law on unclaimed property in the past.
Today, property must be escheated to the state after five years of inactivity. In the past, businesses had to turn over unclaimed property after it had been abandoned for 15 years.
You should send a photocopy of your savings passbook, along with a letter, to General Research, Virginia Department of Unclaimed Property, P.O. Box 2478, Richmond, Va. 23218.
You must include your full name and mailing address, a daytime telephone number, your Social Security number and any old mailing addresses that might apply. You also should include any names that might have appeared on a joint account. Most often this is a spouse, but in your case it might be the name of your father.
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