The Taxpayers gave appreciated stock in I.B.M. and Citigroup to their son, Cyril, a college freshman.
One way to increase the tax savings — and consequently what you can afford to give — is to give appreciated assets to a qualifying charity instead of cash.
But the tax savings can be far larger if they give appreciated securities, which are deductible at market value with no capital gains tax due.
Donors want to talk about their interests, while their advisers tend to talk about the various technical ways to make a donation, like giving appreciated stock.
A parent or grandparent can give appreciated stock to a student age 14 or over before year-end, and the student can then sell it to pay education costs.
"The question is: If you do want to support a charity, what is the most tax-efficient way to do it?" Mr. Weigandt's answer is to give appreciated securities before year-end.
The family in this hypothetical return saved $1,609 and avoided the alternative minimum tax by giving appreciated securities to their son -- who sold them to pay college costs and filed his own return, but owed no taxes -- rather than selling the securities directly to pay his college expenses.
3. Give appreciated assets.
It works like this: You give appreciated property, such as stock, to the trust.
For more advice on giving appreciated and illiquid assets, click here.
And remember whenever possible, give appreciated stock you have held for more than 12 months.
