As the stock market has fluctuated, bonds have grown popular because of their security and steady return. However, redeeming bonds can complicate your tax situation. Giving them as a charitable gift in your will may be a smart way to support a cause you believe in and relieve some of the tax burden on your estate.

If you own bonds, you probably do not declare the interest income as the value of the bond increases. The difference between a bond's purchase price and its value when redeemed is usually taxed when the bond is sold.

Unfortunately, bonds cannot be donated to a charitable organization during your lifetime. Instead, you can redeem the bonds and make a gift of cash. The redemption still triggers tax liability to you on the interest income. If you die owning savings bonds, the untaxed interest may be subject to a combination of estate and income taxes that could absorb as much as 65 percent of the untaxed interest.

Leaving the bonds to the Amputee Coalition of America through your will, however, will allow your estate to donate the full value of the bonds — qualifying your estate for relief from estate and income taxes. Another option is leaving the bonds, upon your death, to a charitable remainder trust to first benefit your loved ones with payments for their lifetimes and then the balance to the Coalition.

Call the Amputee Coalition’s development office at 888/267-5669 if you have questions about bonds and making a gift.