2 ms·

> If he sells the stock he needs to pay taxes on that stock He would need to pay tax on the capital gains. We have no way of knowing what the stock's cost bas

> If he sells the stock he needs to pay taxes on that stock He would need to pay tax on the capital gains. We have no way of knowing what the stock's cost basis is. For sake of example, let's say the $1.8B had a cost basis of $1B. In theory the tax bill would be $160M. While that's a decent chunk of change, I definitely wouldn't describe it as "a large chunk" of the $1.8B being "subsidized by tax payers". Also keep in mind the ultra-wealthy have all sorts of tax avoidance schemes anyway, and regardless of what he spent this money on, he is likely paying a much lower taxation rate than you or I (or the example above). That's a separate topic though.

Retric 8y ago
In that hypothetical situation, 160M would only be part of his deduction, he would also reduce other tax burdens due to the charitable deduction also applying. Also, I would call 0.16 billion a large chunk of 1.8Billion as it would drop that down to 1.64 billion. Anyway I would not call a basis of 1B out of 1.8B a highly appreciated assets. If he wants to keep a more appreciated asset with a basis of say 1/2 or 1/10th it's current price as a better long term investment you can still do this. Donate the highly appreciated stock, sell some less appreciated stock and use the proceeds to buy the stock you want which now has a much higher basis. Then if the stock you buy tanks you can at least take a deduction when you sell it.