Updated July 28, 2026. Quick answer: There are five real options: sell in tranches, donate appreciated shares, gift to family, borrow against the position, or do nothing. Each trades tax cost against risk reduction differently, and doing nothing is a choice with the highest risk.
The options, and what each actually costs
| Option | Tax effect | Risk effect |
|---|---|---|
| Sell in tranches | Capital gain realised, spread across years | Reduces directly |
| Donate appreciated shares | Deduction at value, gain never realised | Reduces, but the money is gone |
| Gift to family | Defers — recipient takes your basis | Moves the risk, does not remove it |
| Borrow against it | No gain realised | Increases — leverage on a concentrated position |
| Do nothing | None | Maximum |
The question that reframes it
If you held this value in cash today, would you buy this much of this one stock? Almost nobody says yes. The position persists because selling feels like an action and holding feels like neutrality — but holding is an active decision to keep concentrated risk.
If the company also pays your salary, the correlation is worse than the position alone suggests. The scenario that destroys the stock is often the same one that ends your income.
Why tranches usually beat a single decision
Selling across tax years spreads the gain across brackets, avoids a single timing bet, and — the part that actually matters — is a rule you can follow when the stock moves, rather than a judgement you have to re-make every quarter.
Sources
IRC §1222; IRC §1015 (basis of gifted property); IRC §170(e)(1).
This states what the cited authority says. It is not tax advice.