If you’re making 20 gifts of $250 each to various charities, you probably won’t want to go through all the paperwork involved in giving away appreciated securities to each one. Instead, you can make one gift of appreciated securities to a “donor-advised fund.” Such funds are offered by many local community foundations as well as by financial firms such as Fidelity, Vanguard, and Schwab. Policies vary but some of these funds will let you open an account for as little as $5,000.
Suppose, for example, you give $5,000 worth of appreciated securities to a donor-advised fund in December 2002. You’d get a $5,000 deduction this year. Then you can ask the fund to give $250 to your alma mater, $250 to a religious organization, $250 to a local animal shelter, etc. The fund will handle all the administrative procedures. What’s more, you can spread the actual donations over several years, even though you’ve taken an upfront deduction.