ivk5 wrote: ↑Thu Jul 19, 2018 12:16 am
usaar33 wrote: ↑Wed Jul 18, 2018 11:23 pm
(Fun fact; If you aren't itemizing, tax benefits of donating appreciated stock are the same regardless of holding time: you simply avoid paying capital gain taxes)
Not the same. Better to donate long term gains since realized hort term gains are taxed at higher rate.
Given this and argument #1, isn't it better to donate short term gains vs. long-term (if you don't itemize)? As it is better to leave the long-term gains in your portfolio to sell.
(I agree argument #2 favors donating long term, but given that you are donating your most appreciated securities, your chances of using them for TLH (while they stay short term!) is generally low.
Needless to say, the general rule seems to be, if not itemizing, to donate the lots that would incur the highest capital gains taxes when sold.
On a related note, there isn't necessarily a clear dichotomy between you are itemizing vs. you are not. Often, it might that if you donate some of your stock, it pushes your itemization above the standard deduction. So effectively, only some portion is deductible (it switches you from standard to itemized deductions) and even more confusingly what that portion is differs on federal vs. state taxes! (from my own experience, my own state (CA) is much harder to figure out due to itemized deduction phase-outs)