Direct indexing, tax loss harvesting and long short tax aware accounts can generate losses that offset gains on a concentrated position. They are useful, but they manage the timing of tax rather than change the economics, and they bring fees, leverage, tracking error and the wash sale rules. For the right client, a charitable remainder unitrust does change the economics.
The donor contributes appreciated assets to an irrevocable trust that pays a fixed percentage of its value each year for life or a term, with the remainder to charity. The trust is exempt from tax, so it can sell and diversify without a current capital gains tax, and the donor is taxed only as payments arrive, largely at capital gain rates. The donor also receives a current deduction for the actuarial value of the remainder, removes the assets from the estate and leaves a charitable legacy. It suits owners approaching a sale, retirees with low basis stock and charitably inclined families; it does not suit anyone without real charitable intent.
The full piece is at turnipseed.law.
