During the boom of the late 1990s, it was easy to suggest that one way to save taxes was to use appreciated securities to make charitable deductions. It still is, especially for those who have held shares of stock for a decade or more. When one donates publicly traded stock held for more than one year, one receives a tax deduction for the fair market value of the shares without having to recognize a capital gain on their sale which usually increases the value of the deduction to the taxpayer by 20% or more.

Another means of improving the tax efficiency for those making substantial charitable contributions is to use the charitable contribution funds established by Fidelity, Vanguard and other organizations. All mutual funds are sold by prospectus which contain important information about fees and expenses. You should always read a prospectus before investing.

These funds which in some ways resemble private foundations are public charities which allow donors to nominate other public charities as the final recipient of the funds. The donor decides how his or her contributions are invested and can direct the fund to distribute funds to charities of his or her choice. For those who are committed to using a portion of their investment income for charitable giving, these funds allow the giver to "bunch" deductions in years where they have the most impact.