When a stock donation might be taxed like a sale
Caution around M&A
This is educational content, not investment, tax, or legal advice, nor a recommendation to buy or sell any security. Work with an adviser.
On Sunday, I wrote about how the stocks of companies being acquired might start to “trade like cash” if the deal were nearly certain to close.
“Trading like cash” means the price has pinned to the acquisition price (or close to it), any risk premium is gone, and a capital gain is hurtling toward you.
At this point, some suggest donating the stock to claim the charitable deduction and avoid the capital gains tax.
There’s just one problem…
