These are appreciated shares with unrealized capital gains of $20,000. By donating these shares instead, this person gets the same $30,000 tax deduction PLUS there is no need to pay capital gains taxes on the $20,000 of gains associated with a later sale of these assets. By donating the appreciated shares, and then using the available cash to repurchase those shares, we have erased $20,000 of taxable capital gains from the investment portfolio.
