Let me start with the order of operations, because it matters: the reason to give is that you want to give. The tax code doesn't make giving profitable — you will always have more money by not giving. What the tax code does is make generous people needlessly expensive to themselves when they give the wrong asset, in the wrong year, in the wrong order. If you're going to give anyway, do it well.
And if you hold appreciated company stock, you have the single best giving asset there is. Here's why.
Rule one: give the stock, not the cash
Say you own shares worth $50,000 that you bought — or vested — at $10,000, held over a year. Sell them to fund a gift and you first owe capital gains tax on the $40,000 gain; the charity gets what's left. Give the shares directly and two good things happen at once: you generally deduct the full $50,000 fair market value, and nobody ever pays the capital gains tax — the charity sells tax-free. The mechanics are laid out by Fidelity Charitable, and the underlying rules live in IRS Publication 526.
Two technicalities worth knowing: the shares must be held more than one year to deduct full market value, and deductions for appreciated securities are capped at 30 percent of your adjusted gross income in a given year (unused amounts carry forward up to five years). For someone unwinding a concentrated position, this is a genuinely elegant lever — every gifted share is a share you exit at a 0 percent capital gains rate.
Rule two: bunch, probably with a donor-advised fund
You only get a charitable deduction if you itemize, and the 2026 standard deduction is $16,100 single / $32,200 married filing jointly. Give $10,000 a year as a married couple and, unless you have big other deductions, you may be getting no tax benefit at all — the standard deduction was going to beat your itemized total anyway.
The fix is bunching: compress several years of giving into one tax year, clear the itemizing hurdle once, take the standard deduction the other years. And the tool that makes bunching practical is the donor-advised fund — you contribute (ideally appreciated stock) in the big year, take the deduction then, and grant the money out to actual charities on whatever schedule you like. The gift timing and the tax timing come apart, which is the whole trick.
The 2026 changes you should actually know about
The 2025 tax law (the One Big Beautiful Bill Act) rewrote several charitable rules starting January 1, 2026. DAFgiving360 has a good summary; the three that matter for most of my clients:
- A 0.5%-of-AGI floor for itemizers. Only giving above half a percent of your AGI is deductible now. At $600K of income, your first $3,000 of annual giving earns no deduction. Notice what this does: it penalizes the drip-drip pattern and rewards bunching even more, since you only eat the floor in the years you actually claim deductions.
- A 35-cent cap for top-bracket donors. If you're in the 37 percent bracket, your charitable deductions now save at most 35 cents per dollar. Mildly annoying, not plan-changing.
- A small deduction for non-itemizers. Up to $1,000 single / $2,000 married for cash gifts to operating charities — nice for standard-deduction years, though notably it excludes gifts to donor-advised funds.
Putting it together
For someone with concentrated stock who gives regularly, the playbook is short: give shares instead of cash, always the long-term lots with the lowest basis. Bunch several years of giving into your high-income years through a donor-advised fund, sized against the 30 percent AGI ceiling. Mind the new floor by concentrating deductions into fewer years. And keep the receipts — appreciated-property gifts have real substantiation rules, which is what your CPA is for.
None of this changes why you give. It changes how much good the same generosity does — for the charity, and for the version of your balance sheet that's trying to get un-concentrated. If you want to model it against your actual position, you know where to find me.
Sources
- Fidelity Charitable — Donating Stock to Charity — mechanics of gifting appreciated securities
- IRS Publication 526 — Charitable Contributions — deduction rules, including the 30%-of-AGI limit for appreciated securities
- DAFgiving360 — What the One Big Beautiful Bill Act Means for Charitable Giving — the 0.5% AGI floor, the non-itemizer deduction, and the 35% cap, all effective 2026
- IRS — Tax Year 2026 Inflation Adjustments — 2026 standard deduction: $16,100 single / $32,200 married filing jointly
- National Philanthropic Trust — DAF Tax Considerations — how donor-advised funds work
This article is for informational and educational purposes only and is not investment, legal, or tax advice. Nothing here is a recommendation for your specific situation — talk to your advisor and your CPA before acting on anything you read. Fathom Wealth is the private wealth practice of Cameron Hunt, conducted through Savvy Advisors, Inc., an SEC-registered investment adviser. Tax figures cited reflect rules in effect for the year noted and can change.