This guide will walk you through actionable strategies, practical tips, and answers to common questions so you can plan your charitable giving confidently before year-end.
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Donating to charity is a meaningful way to support causes you care about — and, when done strategically, it can also provide significant tax benefits. In 2025, with changes to charitable deduction rules coming in 2026, thoughtful planning can maximize both your impact and your tax savings.
By timing donations, using donor-advised funds (DAFs), and contributing appreciated assets, you can make the most of your giving this year. This guide will walk you through practical strategies, numbered tips, and answers to common questions, so you can give with confidence and efficiency.
Disclaimer: The figures here reflect the donations made in 2025. Starting in 2026, new rules under the One Big Beautiful Bill Act (OBBB) will introduce a 0.5% AGI floor for itemized deductions, a deduction cap for high-income taxpayers, and an above-the-line deduction for non-itemizers.
2025 is one of the last years to take full advantage of the current charitable deduction rules before the 2026 changes take effect. Here’s why:
By giving strategically in 2025, you can maximize deductions under the current rules while preparing for the upcoming changes in 2026.
A donor-advised fund is a charitable giving account that allows you to contribute cash or eligible assets and receive an immediate tax deduction if you itemize. You can then recommend grants to charities over time. This flexibility allows you to “bunch” multiple years’ worth of donations into 2025 while spreading grants across future years.
If you usually donate smaller amounts annually, consider combining several years’ worth of contributions into 2025. For example, instead of giving $2,000 each year for five years, contribute $10,000 in 2025. This can push your itemized deductions above the standard deduction, maximizing your tax benefit. A DAF is ideal for distributing these funds over multiple years while still taking the deduction in 2025.
Donating long-term investments, like stocks or mutual funds, directly to a charity or DAF allows you to deduct the fair market value while avoiding capital gains tax. For 2025, the deduction for non-cash gifts is generally limited to 30% of AGI. This strategy increases tax efficiency while supporting your favorite causes.
To ensure contributions count for the 2025 tax year, donations must be processed by December 31, 2025. This applies to cash gifts, DAF contributions, and non-cash assets. Planning ahead is especially important for larger or more complex donations that require additional processing time.
Proper documentation is essential. For cash donations, keep receipts from the charitable organization. For non-cash gifts, maintain appraisals, valuation records, and proof of the asset’s holding period. Accurate records are crucial for IRS compliance and audit protection.
Only donations made while itemizing qualify for a charitable deduction. Compare total itemized deductions — including charitable contributions, mortgage interest, and state and local taxes — to the standard deduction to determine the most advantageous approach for your situation.
Starting in 2026, new rules will limit the tax benefits of charitable giving: a 0.5% AGI floor for itemized deductions, a deduction cap for high-income taxpayers, and a small above-the-line deduction for non-itemizers. Giving strategically in 2025 allows you to maximize deductions under the current rules before these changes take effect.
1. Can I deduct donations if I take the standard deduction in 2025?
No. Only itemizers can deduct charitable contributions in 2025. The new above-the-line deduction for non-itemizers begins in 2026.
2. Can I get a deduction from a DAF even if I don’t pick a charity immediately?
Yes. You receive a deduction when you fund the DAF (if you itemize), and you can recommend grants to charities over time.
3. What types of assets can I donate besides cash?
Long-term investments such as stocks, mutual funds, and other appreciated assets. You may deduct the fair market value and avoid capital gains tax, subject to AGI limits.
4. Are there limits on deductions?
Yes. Cash gifts: up to 60% of AGI. Appreciated non-cash gifts: up to 30% of AGI. Excess contributions can be carried forward for up to five years.
5. Why is 2025 a strategic year for charitable giving?
Because 2026 introduces new floors and caps, 2025 provides the last opportunity to maximize deductions under the current rules. Strategic giving now locks in higher tax benefits.
Charitable giving in 2025 is not just about generosity — it’s also a strategic opportunity to maximize tax benefits. By timing donations, using a donor-advised fund, and contributing appreciated assets, you can make the most of your giving this year.
If you want personalized guidance on structuring donations or estimating potential tax savings, the team at Vincere Tax can help. We’ll create a tailored giving plan, ensure you don’t miss deadlines, and help you maximize both your charitable impact and your tax benefits.
This post is just for informational purposes and is not meant to be legal, business, or tax advice. Regarding the matters discussed in this post, each individual should consult his or her own attorney, business advisor, or tax advisor. Vincere accepts no responsibility for actions taken in reliance on the information contained in this document.
For business tax planning articles, our tax resources provides valuable insights into how you can reduce your tax liability now, and in the future.
For business tax planning articles, our tax resources provides valuable insights into how you can reduce your tax liability now, and in the future.
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