Have you ever considered the benefits of gifting appreciated assets?
As a high-income earner, you might have accumulated investments or properties that have grown significantly in value. But what if there was a way to share that wealth with loved ones or charitable organizations while also optimizing your tax situation?
Below, we’ll examine what appreciating assets are, why gifting them can be beneficial, and the tax implications to consider.
The appreciation of assets involves investments or properties that have increased in value since you acquired them. Common examples of assets that appreciate include:
For instance, if you purchased 1,000 shares of stock at $2 per share and they're now worth $200 per share, you have an appreciating asset with significant gains.
Gifting assets that appreciate can benefit both you and the recipient. Here are several reasons to consider this approach:
By gifting appreciated assets instead of selling them and giving cash, you can avoid paying capital gains tax on the increase in value.
Gifting an appreciated asset can help reduce the size of your taxable estate, potentially lowering future estate taxes for your heirs.
Donating appreciated assets to charity can provide a tax deduction while maximizing the value of your gift to the organization.
When it comes to gifting appreciable assets, the process varies based on the recipient and the type of asset. Common scenarios include:
You can directly transfer ownership of stocks, real estate, or other assets to family members. However, be aware of gift tax limits and potential basis implications.
Many charitable organizations can accept gifts of appreciated assets. This can be done through a direct donation or through a donor-advised fund (DAF).
Establishing a trust can be an effective way to transfer appreciated assets, especially for estate planning or managing generational wealth.
(Sources: IRS Publication 526, IRS Publication 559)
Gifting appreciated assets comes with several tax implications that high-income earners should carefully consider:
When planning to gift appreciated assets, keep these strategies in mind:
| Gift Method | Potential Tax Benefit | Key Consideration |
| Gift to Family | Avoid capital gains; reduce estate size | Recipient inherits cost basis; may owe capital gains when sold |
| Gift to Charity | Deduct fair market value; avoid capital gains | Deduction capped at 30% of AGI for appreciated assets |
| Gift via Trust | Reduces estate; maintains control | More complex setup; requires legal guidance |
Source: IRS
Appreciated assets are investments or properties that have increased in value since you acquired them, such as stocks, real estate, or business interests.
This strategy can help reduce your taxable estate, avoid capital gains tax, and increase the impact of charitable donations.
In 2025, you can gift up to $18,000 per recipient ($36,000 for married couples) without triggering gift tax reporting.
Yes. Many charities and donor-advised funds accept gifts of appreciated assets, allowing you to avoid capital gains while claiming a charitable deduction.
Gifting appreciated assets can be a powerful financial strategy for high-income earners. By understanding the process, tax implications, and timing considerations, you can make informed decisions that benefit both you and your chosen recipients.
While the potential advantages are significant, the rules can be complex. Always consult qualified tax and financial professionals before making substantial financial gifts.
If you are interested in learning more about giving appreciated assets and how it works with your specific financial situation, please contact one of our financial planners.
Any discussion of taxes is for general information purposes only, does not purport to be complete or cover every situation, and should not be construed as legal, tax or accounting advice. Clients should confer with their qualified legal, tax, and accounting advisors as appropriate.
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This article was written in collaboration with the financial professionals at Spaugh Dameron Tenny. Our team features CERTIFIED FINANCIAL PLANNER® professionals, Certified Exit Planning Advisors, insurance specialists, investment coordinators, and experienced analysts – all dedicated to addressing the unique financial needs of physicians, dentists, executives, and retirees. With decades of collective experience, we provide clear and comprehensive guidance in all areas of financial planning, wealth management, retirement planning, investment strategies, and practice transitions.
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