As you plan your year-end charitable donations, consider these strategies to maximize your impact.

Make a gift that holds meaning for you. Regardless of your gift’s economic benefits, it must first provide you with joy and satisfaction. Choose a cause you are passionate about supporting. If you have a family mission statement, this is a great time to revisit your family’s charitable mission. If you do not have a family mission statement or are interested in creating one, we’re here to help. See Koby Cross’s article “Defining Your Family’s Charitable Compass” on page 3 for more on family charitable mission statements.

Make an Impact: Tax-Smart Charitable Giving

Talk with your trusted advisors (financial advisor, CPA, or attorney) about your charitable goals. Evaluate the gifting you have already done this year, and determine how this contribution fits into your overall gifting plan. Strategizing now will enhance your gift’s charitable impact and tax efficiency. Here are a few strategies to consider:

Give More, Pay Less: The Power of Donating Appreciated Stock

If you hold stocks or mutual funds in a taxable account that have increased in value since purchase, gifting this investment to charity may allow you to receive a tax deduction based on the gift’s full value while eliminating capital gains tax on the appreciation.

Flexibility and Control: The Power of a Donor-Advised Fund

Using a Donor-Advised Fund (DAF) provides significant flexibility. If you make many smaller gifts to charities and do not want to gift small amounts of appreciated stock multiple times, consider using a DAF. You can make one annual gift of an appreciated asset to the DAF, then grant those funds to charities throughout the year and in future years.

A DAF is also a great solution if you experience a significant tax event and want to make a one-time larger donation for the tax benefit. You receive the deduction in the year you fund the DAF, and then grant to specific charities later as opportunities allow.

The One Big Beautiful Bill Act: What It Means for Charitable Giving

The OBBB, signed into law on July 4, 2025, preserves elements of the 2017 Tax Cuts and Jobs Act (TCJA) while introducing new provisions that shape charitable giving. Several provisions take effect beginning with the 2025 tax year, making it essential to evaluate how these changes may influence your current philanthropic planning strategies.

OBBB introduces three new tax provisions that could significantly influence decisions on charitable giving strategies, offering both expanded opportunities and important considerations for donors.

1. Above-the-line charitable deductions for non-itemizers

Beginning in the 2026 tax year, a reinstated deduction allows non-itemizers to deduct cash donations to charity — up to $1,000 for single filers or $2,000 for married couples filing jointly. Some types of donations are ineligible for the deduction, including those to donor-advised funds or private non-operating foundations. With the introduction of this provision, all households are now eligible to receive a tax deduction for qualified charitable contributions, even if they take the standard deduction.

2. New limits to deductions for itemizers in the top tax bracket

The new legislation caps the tax benefits of itemized charitable deductions at 35%, even for those in the 37% marginal tax bracket. In other words, these high-income filers donating $1,000 would receive a $350 deduction instead of the current $370. This change goes into effect in the 2026 tax year. Donors in higher tax brackets who are considering a significant philanthropic gift may want to consider accelerating their gift to 2025 to maximize their deduction under the current marginal rate before the new cap takes effect.

3. New floor on deductions for itemizers and corporations

Effective in the 2026 tax year, itemizers who make charitable contributions will only be able to claim a tax deduction to the extent that their qualified contributions exceed 0.5% of their adjusted gross income (AGI). For example, a couple with an AGI of $300,000 could only deduct charitable donations in excess of $1,500. A bunching strategy or an approach of making larger gifts less frequently can be more effective under the new rules.

Tax-Smart Giving for Retirees: Qualified Charitable Distributions

A Qualified Charitable Distribution (QCD) is a distribution directly from your individual retirement account to a qualified charity. You must be 70 1/2 or older to be eligible to make a QCD, and the donated amount (up to $108,000 per year) is excluded from your taxable income. Keeping your taxable income lower also may help reduce the amount of your Social Security income that is taxable and the amount of your Medicare premiums. A QCD counts toward the client’s Required Minimum Distribution without being included in their taxable income.

Ready to Make a Difference?

Taking the time to plan your year-end charitable giving proactively ensures that your gift has the most significant impact for you and those in need. Contact your trusted advisor today to discuss your philanthropic goals and explore strategies that align with your financial plan. We’re here to help ensure you achieve your financial and charitable goals.