Question: Every year I donate roughly $10,000 to charities. My accountant has never suggested to me that I donate some of my appreciated stock instead of cash to save the capital gains tax. He knows my pattern of behavior — that I’m going to make the donations. Am I missing something? Wouldn’t it be wise to donate appreciated stock?

Ric: It seems your accountant is lazy or uninformed. He should indeed have been giving you that very advice.

Yes, you can lower your taxes significantly by donating stocks, bonds, mutual funds, real estate and other assets that have risen in value instead of cash. It makes no difference to the charity — it will get the same amount of money either way. (That’s because charities are tax-exempt organizations and don’t pay taxes.) But you do care: Even though you get a tax deduction for the donation, whether it’s cash or stock, donating stock lets you avoid capital gains tax on the appreciated asset.

Here’s an example. Say you have $10,000 in cash plus $10,000 worth of stock that you bought for $2,000. Say you sell the stock and donate the proceeds. You’ll get a tax deduction for the donation, but you’ll owe taxes from the sale of the stock.

If you instead donate the stock, you’ll still get the same tax deduction for the donation — and now you’ll also avoid having to pay taxes on the stock sale. And the charity will still get (and keep) the full donation — because it pays no taxes when selling the stock.

So instead of selling the stock, give it to the charity and let it sell the shares.

Many charities are aware of this aspect of tax law and are skilled at facilitating the paperwork to get all this done for you. They’re motivated, of course, because they want your donation. And you’re motivated because you want to lower your taxes. A rare win-win in the tax code!

I warn you, however, that the process can take four to six weeks. Therefore, don’t try to donate assets on Christmas Day for the current tax year, because the transaction won’t get completed before the end of the year. So, start the process no later than Nov. 1 of each year.

Meanwhile, you might want to think about hiring another tax preparer.

Please add tax and legal disclosure: This material was prepared for informational and/or educational purposes only. Neither Edelman Financial Engines LLC nor its affiliates offer tax or legal advice. Be sure to consult with a qualified tax or legal professional regarding the best options for your particular circumstances.