7 Charitable Gifting Strategies: How to Give More This December and Keep More at Tax Time

It’s the season of giving. You’ve got presents to buy for family and friends, and your mailbox (and inbox) is full of requests from charities and nonprofits asking for support. With so many worthy causes, how do you decide who to give what to? That’s where charitable gifting strategies may come in.

Here’s something most people don’t think about in December: your year-end tax bill is in your control. Every year, a portion of what you earn automatically goes to the government. That’s just part of life. Wouldn’t you like to have the option of steering more of your money towards people and causes of your choosing?

With a little planning before December 31, you can support the charities you love and potentially reduce what you owe at tax time through tax deductions. This guide walks you through a practical charitable giving strategy so you can give generously and cheerfully this holiday season.

How the Tax Benefit of Charitable Donations Actually Works

Most people know charitable giving can reduce taxes — but very few understand how the benefit works. You have two choices every time you file taxes.

Path 1: Take the Standard Deduction

The standard deduction is a flat amount the IRS automatically subtracts from your income based mainly on your filing status, age, and whether you’re blind. It’s like a built-in coupon the government gives you just for filing your taxes. Most people take this standard deduction because it gives them a larger tax break than itemizing does.

Path 2: Itemize Your Deductions

Itemizing your deductions involves listing deductible expenses like mortgage interest, state/local taxes, medical expenses, and other Schedule A deductions one by one, adding them up, and deducting those from your income.

To know which deduction saves you more, simply compare your total itemized deductions to the standard deduction. If your itemized amount is higher, your charitable gifts lower your taxes; if not, the standard deduction gives you the better deal. 

For example, if you itemize and your charitable gift of $1,000 puts you beyond the standard deduction (and you’re in a 30% tax bracket), then that gift may feel more like $700 because of the tax savings.

Allowable deductions for charitable donations are subject to Adjusted Gross Income (AGI) limits and other IRS caps and can change from year to year.

Strategy 1: Donate Appreciated Stock (Not Cash)

Most people give cash, but donating long-term appreciated stock (shares you’ve held for more than a year) can give you two big tax benefits:

• You may deduct the full fair market value of the stock, within IRS limits.
  
• You avoid the capital gains tax you would owe if you sold the stock yourself.
  

This strategy isn’t limited to stock — certain other long-term appreciated assets can qualify too, though they may require appraisals or additional forms. If you own something that’s gone up in value — and you’ve held it for more than a year — consider donating that instead of writing a check.

But donating appreciated stock isn’t the only way to maximize your impact. Sometimes, the timing of your gifts matters just as much as the assets you use.

Strategy 2: “Bunch” Your Giving to Make It Count

If you give every year but still take the standard deduction, your donations may not lower your taxes at all. “Bunching” lets you change that.

Here’s how it works: Give several years’ worth of donations in one year so your itemized deductions finally rise above the standard deduction. You get the tax break that year, and in the following years, you go right back to the standard deduction.

It’s like saving up your generosity and using it strategically so your giving actually moves the needle at tax time. 

Pair this with a donor-advised fund, and you can still spread out your grants to charities over time.

Strategy 3: Use a Donor-Advised Fund (DAF)

Think of a donor-advised fund as your personal giving hub. You put money (or appreciated stock) into it now, take the deduction right away, and then send gifts to your favorite charities whenever you feel inspired.

Here’s the magic for year-end planning: you can “bunch” several years of gifts into the DAF in one year so your itemized giving exceeds the standard deduction, then continue supporting charities steadily over time. The charities never feel the gap, even though your tax strategy becomes much more efficient.

And if you use appreciated stock to fund your DAF, you avoid capital gains and get a larger deduction — a double win.

DAFs allow you to be consistently generous while doing your tax planning strategically behind the scenes. But what happens if your donations for the year are so large that you hit the IRS deduction limits? That’s when charitable carryovers can be incredibly useful.

Strategy 4: Know the AGI Limits (and Use Carryovers)

Your charitable deductions are capped each year—typically 60% of AGI for cash gifts (depending on the type of recipient, percentages may vary by type of charitable entity) and 30% for appreciated assets. If your giving exceeds those limits, the IRS lets you carry the unused deduction forward for up to five additional years. 

For example, if your AGI is $200,000, the IRS usually lets you deduct up to $120,000 in cash gifts (60% of AGI) and up to $60,000 in appreciated assets like stock (30% of AGI).

Now, say you give $150,000 in cash plus $40,000 in appreciated stock in the same year. You can only use $120,000 of the cash gift this year, but the extra $30,000 doesn’t disappear—it carries forward so you can use it over the next five years, as long as you stay within the AGI limits in those years. Your $40,000 stock gift is under the $60,000 cap, so you can deduct that in full right away. 

This is one of the most overlooked tools in charitable planning, and it ensures big-hearted giving never goes to waste.

But if you’re over 70½ and looking for a tax-efficient way to give without itemizing at all, the next tool may be even more valuable: the Qualified Charitable Distribution.

Strategy 5: If You’re Over 70½, Consider a Qualified Charitable Distribution (QCD)

For retirees—especially those who don’t itemize—Qualified Charitable Distributions can be one of the most tax-efficient ways to give.

A QCD lets you send money directly from your IRA to a qualified charity once you’re age 70½. When structured correctly, your QCD:

• Is excluded from your taxable income
  
• Can count toward your Required Minimum Distribution (once you reach RMD age)
  
• Supports your favorite charities without increasing your income taxes
  

Unlike many deduction-based strategies, a QCD lowers your actual income, which means it can also help keep Medicare premiums and taxes on Social Security benefits down.

There are a few rules to know: QCDs are capped annually (a little over $100,000 per person for 2025), and they must go to eligible charities—not donor-advised funds or private foundations.

QCDs offer powerful benefits for retirees, but when your goals involve larger gifts or long-term planning, more advanced options may be appropriate. 

Limits and caps may vary from year to year; please verify or consult with a professional. 

Strategy 6: Use Charitable Trusts for Major Gifts and Long-Term Planning

When clients want to give a more sizeable donation — especially after selling a business, real estate, or other appreciated assets — we often talk about charitable trusts. These trusts allow you to support the causes you care about while also creating real tax advantages. Here are the two primary options:

• Charitable Remainder Trust (CRT): You (or another beneficiary) receive income for a set number of years or for life. When the trust ends, the remaining assets go to charity.
• Charitable Lead Trust (CLT): Charity receives income first, and whatever remains later goes to your chosen heirs — often with valuable gift or estate tax benefits.

These trusts follow detailed IRS rules and are not DIY strategies. They should always be designed with an estate planning attorney or a tax attorney to ensure compliance and maximize benefits. Charitable trusts are powerful tools for major gifts, but they’re not the only option for families who want to give with intention. If you’re looking for a long-term, structured way to support the causes you love — and even involve your children or grandchildren — a private foundation might be the next strategy to consider.

Strategy 7: Private Foundations for Long-Term Family Giving

For families who want their generosity to become part of their legacy, a private foundation can be a beautiful fit. It creates a central place for giving, offers significant control over how funds are invested and distributed, provides opportunity for management to earn reasonable salaries, and allows multiple generations to participate together. 

Foundations do come with administrative requirements and annual reporting, so they’re usually best suited for substantial or ongoing giving. Since they’re also not DIY, it’s best to consult with an estate planning attorney or tax attorney. With all these tools available — from simple gifts to more advanced structures — thoughtful planning can make your generosity go even further. And with new tax rules on the horizon, understanding what’s changing next year can help you decide which strategies to use now.

What’s Changing After 2025: Why Timing of Your Charitable Giving Strategy Matters

Beginning in 2026, federal rules for charitable deductions are getting a significant overhaul. The opportunities to give aren’t disappearing — but the way deductions work will shift. Here’s what’s to anticipate in 2026:

• Non-itemizers will be allowed a small charitable deduction. For the first time, single filers can take a $1,000 charitable deduction, and married couples can take a $2,000 deduction.
• Itemizers will face a new 0.5% of AGI “floor”. This means only donations above that threshold will be deductible.
• High-income taxpayers may see their deduction benefit capped at roughly 35%, instead of their full marginal tax rate.

These changes don’t make giving any less meaningful — they just make timing matter more. 2025 may be your best year to take full advantage of today’s simpler deduction rules. Starting in 2026, you’ll need to be a bit more thoughtful about AGI limits and new deduction floors. 

Closing Thoughts on the Tax Benefits of Donating to Charity

Since it’s better to give than receive, why not allow your generosity to have more impact? If you’d like help choosing the approach that best fits your income, tax situation, short and long-term goals, or the assets you want to donate, or if you’d like to learn more about the lifetime gift tax exclusion, I’d be honored to help guide you. 

At Gammon & Grange, we love working with people who care about their communities, and we’re here to make sure your giving is supported with smart, thoughtful planning.

This blog provides general information about tax and related topics for informational purposes only. It is not legal advice, does not create an attorney-client relationship, and should not be relied upon to make decisions about your specific situation. Readers should consult an attorney or other appropriate professional for advice tailored to their particular facts and circumstances.

Tax laws and thresholds change, and application of the law depends on individual facts; for guidance on your situation, please confirm current figures and seek personalized legal counsel from a licensed professional in your jurisdiction.