"Dave Dodson" <dave_and_darla[at]Juno.com> writes:

- quote -

If you want to spread out the charity-donations over
several years and/or several charities, and the stock
in question is worth more than $10,000, you might want
to look into something like the Fidelity Charitable Gift
Fund. Using a donor-advised fund (there are many - Fido
is only one of them, but it's the biggest and has an
excellent website), you donate the appreciated stock to the
Fund, take the taxdeduction for the year in which you make
that transfer, then the procceeds of the sale of the
stock (which the Fund does, internally) are available in
your account - where you then make "recommendations" as
to where charity money should go.

This way, you don't have to transer a few shares here and
there to multiple places, etc. etc. Very spiffy.

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There are a few ways you can avoid the capital gains taxes.

1. You can die. Upon your death, the basis will be stepped up to the
fair market value for your heirs. I'll leave it to you to decide if
this is a viable option. :-)

2. You can give the stock to a charity. If you already make charitable
contributions, substitute some of the stock for cash. You can claim the
deduction for the value of the stock on the day of the gift, and
completely avoid the capital gains tax. Use the cash you didn't
contribute to buy the investments you want.

3. Since you have kids who heading to college in a few years, you could
give the stock to any of your kids over age 14. Make sure you don't
exceed the gift tax threshold. It used to be $11,000 per kid per year;
maybe it is more now. Capital gains taxes still would be due on the
sale, but at the kid's rate, not yours. Of course, the money then is
theirs, but they could use it for their college expenses. It might
impact their ability to get financial aid, if they would be eligible.

On the other hand, you could just pony up the capital gains taxes. If
you sell the stock, you certainly will have the money to pay them.

Dave

Several years ago, my grandmother gifted stock to me. These stocks
were originally purchased by my grandparents 10-20 years ago. They
have appreciated greatly and are worth double, quadruple or more above
their cost basis. It is my understanding that, my cost basis is the
same as what it was for my grandmother when she gifted them, and
therefore I have a huge capital gain associated with these. Some of
the stock quantities are of the size that uncomfortable with having
that much invested in one company. And/or I would prefer to have some
of this money invested in other companies. What is my best move to
avoid the large capital gains tax I would have to pay if I just sold
them outright? I am also in the mode where I want to put a significant
amount of money in my kids college savings. Is there a way I can use
these highly appreciated gifted stocks to fund college savings AND
avoid the high capital gains?