As the holidays approach, many of us start thinking about giving back. Whether it’s supporting your favorite local nonprofit, donating to your place of worship, or helping a cause you care deeply about, charitable giving is a tradition that feels good. But it can also make a meaningful difference on your tax return—if you plan it the right way. Use the following guidelines to manage your charitable gifts during this season of giving.
To be deductible on a federal return, charitable contributions must meet IRS criteria:
Qualified Recipients
- IRS-recognized 501(c)(3) organizations. You can check eligibility by visiting IRS Tax Exempt Organization Search Tool:
https://www.irs.gov/charities-non-profits/tax-exempt-organization-search - Government entities, such as schools (if used for public purposes)
- Certain international organizations (under specific treaties)
Political groups and social clubs are generally not qualified charitable organizations. If you’re giving through a crowd-funding platform such as GoFundMe, your donation would only be deductible if the recipient is a registered 501(c)(3) organization.
Eligible Donation Types
- Cash contributions (check, credit card)
- Non-cash assets (securities, digital currencies, real estate, vehicles)
- Volunteer-related expenses (mileage, supplies)
Note: Time or services are not deductible.
Documentation Requirements
- Under $250: Bank record or receipt
- $250 or more: Written acknowledgment from the charity
- Over $500 (non-cash): IRS Form 8283
- Over $5,000 (property): Qualified appraisal required
Timing matters, as well: only contributions made before December 31st count for this year’s tax return. That means gifts made in January 2026 will apply to next year, not this one. If you’re thinking of donating, doing it now ensures your generosity works to your tax advantage this year.
“Bunching” donations can help maximize current-year deductions. Since the standard deduction is fairly high, some taxpayers find it difficult to itemize and benefit from their giving each year. By combining multiple years’ worth of contributions into a single tax year, you may cross the threshold that allows you to itemize—and maximize your deduction. For example, if you’re already planning to donate to a particular charity in 2026, you can make the gift before the end of this year to boost your total 2025 giving.
Another strategy is to think beyond cash. Donating appreciated stock or other assets can give you a double benefit: you avoid paying capital gains tax on the appreciation, and you get a charitable deduction for the fair market value of the gift. That’s a win-win from both a tax and charitable giving perspective
Donor Advised Funds (DAFs) are another strategic and tax-efficient tool for charitable giving that can complement a client’s overall financial and estate planning. By contributing to a DAF, donors receive an immediate tax deduction while retaining the flexibility to recommend grants to their favorite charities over time. This allows clients to separate the timing of their tax deduction from their philanthropic decisions, making DAFs especially useful in high-income years or during liquidity events. DAFs offer a streamlined way to manage charitable contributions, reduce taxable income, and build a lasting legacy of giving—all while simplifying recordkeeping and compliance.
Charitable giving should always start with the heart—but when you add a little strategy, it can also be a powerful tax-saving tool.
If you’d like to review your options and make sure your generosity is working as hard for your taxes as it does for your favorite causes, let’s schedule a quick call. With the right plan, you can maximize both the impact of your gift and the benefit on your tax return. Here’s to giving in ways that matter—both now and for the future!
