Why it can be an excellent choice
Increase your impact by donating Bitcoin or other cryptocurrency directly to charity. Compared with donating cash or selling your cryptocurrency and contributing the after-tax proceeds,you may potentially increase tax efficiency and the size of your charitable gift.
Eliminate capital gains taxes and the Medicare surtax,which combined could be up to 23.8%
Takean immediateincome tax deductionin the amount of the full fair-market value*if you itemize your deductions
Maximize support to your favorite charities
*For contributions of complex or non-publicly traded assets, generally fair market value is determined by a qualified appraiser in compliance with the IRS.
Potential tax benefits of donating cryptocurrency
When you contribute Bitcoin or other cryptocurrency directly to charity, the receiving organization gains full proceeds from the sale, and you potentially eliminate capital gains exposure. This win-win could mean more money for the causes you care about. Consider this potential savings example:
Original cost of Bitcoin $50,0001
Federal long-term capital gains rate23.8%2
Value of Bitcoin:$350,0003
Capital gains and Medicare surtax paid on $300,000 (23.8%)
Selling your Bitcoin and donating the proceeds
-$71,400
Donating your Bitcoin to Fidelity Charitable
$0
Total contribution to charity
(after deducting federal taxes)
Selling your Bitcoin and donating the proceeds
$278,600
Donating your Bitcoin to Fidelity Charitable
$350,000
Selling your Bitcoin and donating the proceeds
Donating your Bitcoin to Fidelity Charitable
Additional amount dedicated to charity
+$71,400
1Total Cost Basis of Shares is the amount of money you have invested in the shares of a particular fund or individual security. It represents the basic dollar amount that, when compared to the price at which you sell your shares, tells you how much of a capital gain or loss you have realized.
2This assumes all realized gains are subject to the maximum federal long-term capital gains tax rate of 20% and the Medicare surtax of 3.8%. This does not take into account state or local taxes, if any.
3Amount of the proposed donation is the fair market value of the appreciated securities held more than one year that you are considering to donate.
Fidelity Charitable currently accepts Bitcoin, Ethereum, and Litecoin.
Fidelity Charitable currently accepts Bitcoin, Ethereum, and Litecoin.
CASE STUDY
The value of Anna’s Bitcoin increased significantly since her initial investment several years ago.
Given recent market volatility, Anna wanted to leverage her digital currency for good.
By contributing her Bitcoin directly to Fidelity Charitable, she eliminated capital gains tax exposure and secured a charitable deduction based on the Bitcoin's fair market value. This savings enabled her to contribute more to her Giving Account than she would have if she sold the Bitcoin and donated the after-tax proceeds. As a result, she was able to recommend a multi-year grant to support young entrepreneurs in her community.
Added benefits of a Giving Account
- Support charities immediately or over time
- Support multiple charities with a single contribution
- Streamline recordkeeping
- Consolidate many tax receipts into one
Ready to get started?
Start making a difference today by opening a Giving Account—no minimum required.
Frequently asked questions
What types of cryptocurrency does Fidelity Charitable accept?
Fidelity Charitable currently accepts Bitcoin, Ethereum, and Litecoin.
What are the tax benefits of donating cryptocurrency?
As with any appreciated asset, capital gains tax is paid on any realized gains when cryptocurrency is sold. However, donating cryptocurrency directly to charity can potentially eliminate the capital gains tax. The donor may also be eligible for the secondary benefit of a tax deduction of the full fair market value of the asset as determined by an independent qualified appraisal.
What is the process for donating cryptocurrency?
To contribute certain cryptocurrencies, Fidelity Charitable requires a Cryptocurrency Letter of Understanding. Contact a Fidelity Charitable planning expert to process the contribution as additional special handling instructions may be required. Fidelity Charitable streamlines the gifting process from asset acceptance, receipting, and liquidating assets through select providers to fund the Giving Account.
Can I retain my cryptocurrency once donated?
Once Fidelity Charitable accepts a contribution, it is irrevocable. The asset is exclusively owned and controlled by Fidelity Charitable. Fidelity Charitable generally seeks to sell contributed property promptly, and will allocate the net proceeds to the Giving Account.
What other types of assets can I donate?
Fidelity Charitable accepts a wide range of financial assets, from cash and checks to stocks and even non-publicly traded assets.
