Updated July 28, 2026. Quick answer: Donating shares held more than a year generally deducts their full fair market value while the built-in capital gain is never taxed to anyone. The trade-off is a 30%-of-AGI ceiling instead of the higher one that applies to cash.
Why the shares beat the cash
Sell first and you realise the gain, pay tax, and donate what is left. Give the shares directly and, for long-term capital gain property given to a public charity, you generally deduct the full fair market value under IRC §170(a) and the appreciation is never taxed — the charity is tax-exempt on the sale.
The ceiling is the catch
Appreciated capital gain property given to public charities is limited to 30% of AGI (IRC §170(b)(1)(C)), lower than the ceiling for cash. Excess carries forward up to five years.
The holding period is not optional
Shares held a year or less are short-term capital gain property, and the deduction is limited to your BASIS rather than fair market value under IRC §170(e)(1)(A). Donating recently-vested RSUs or freshly-exercised shares therefore forfeits most of the benefit — check the holding period before transferring.
Which shares to give
The lowest-basis lot you have held over a year. The deduction is the same whichever lot you choose; the gain you permanently avoid is largest on the cheapest shares.
Sources
IRC §170(a); IRC §170(b)(1)(C) (30% ceiling and 5-year carryforward); IRC §170(e)(1)(A); IRC §1222(3).
This states what the cited authority says. It is not tax advice.