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As the end of the year draws closer and the holiday season approaches, our thoughts often turn to generosity and gratitude. Year-end giving is not only a way to spread joy and hope, but also a strategic opportunity to align your philanthropic goals with your financial well-being. Let’s explore the power of year-end giving, delving into the strategies and considerations that can help you make a meaningful impact on the causes that matter to you while ensuring your charitable efforts are both effective and tax-efficient.

Here are some important considerations to keep in mind when thinking about your charitable giving:

  1. There are still tax deductions available for charitable giving. Charitable donations can be tax-deductible if you itemize your deductions. Keep in mind that the Tax Cuts and Jobs Act (TCJA) significantly increased the standard deduction which, for many, reduced the incentive for itemizing. For this reason, some taxpayers now employ a “bunching” strategy, where donations are concentrated in a single year to increase all deductions’ value beyond the standard deduction threshold. Then, in the 1-2 years that follow, smaller dollar donations are made and the standard deduction is used.

    If you plan to itemize your deductions, you will want to keep detailed records of your donations, including receipts and acknowledgment letters from the organizations you support. Please also keep in mind there are limits on the amount you can deduct. Consult with a tax professional to understand how your donations will affect your tax situation and if there are any donation limits or restrictions that may apply.

  2. Consider giving appreciated assets. When you sell an asset from a taxable account that has increased in value, you are generally subject to capital gains tax on the profit. However, by donating the asset directly to a qualified charity, you bypass this tax liability and, because you are not paying capital gains taxes on the appreciated value, you can give more to the charitable organizations you support. In addition, you may be able to claim a charitable deduction on your income tax return for the fair market value of the asset at the time of the donation, further maximizing the tax benefit of this strategy.

    It’s important to note that gifting appreciated assets comes with specific rules and requirements. The charity must be a qualified tax-exempt organization, and the fair market value of the asset at the time of the donation must be properly documented. Additionally, the tax benefits can vary based on factors like the type of asset, your income level, and other considerations.

  3. You may want to make a donation through a Qualified Charitable Distribution (QCD). A QCD is a tax-efficient strategy that allows individuals aged 70½ or older to make charitable donations directly from their Individual Retirement Account (IRA) to a qualified charitable organization. When you make a QCD, the distribution is not included in your taxable income. This can be particularly advantageous if you’re concerned about keeping your taxable income low to minimize the impact on Social Security benefits, avoid higher Medicare premiums, or reduce your overall tax liability. Also, if you’re required to take a required minimum distribution (RMD) from your IRA, you can use a QCD to fulfill this requirement without incurring taxable income. For a QCD to count towards your current year’s RMD, the funds must come out of your IRA by your RMD deadline, generally December 31.

    The maximum amount that can qualify for a QCD is $100,000 per taxpayer per year.

  4. A donor-advised fund (DAF) is a powerful and versatile charitable giving tool that can offer numerous advantages for individuals, families, and organizations. Once you establish a DAF, you can contribute to the DAF as often as you would like. Those contributions are tax-deductible in the year they are made, providing an immediate tax benefit. The contributions then can be held in the DAF until you wish to grant the funds to a qualified charitable organization. This vehicle allows you to immediately realize the tax advantages of charitable giving while giving you the flexibility to grant funds to charitable organizations when your charitable goals and timing align.

    There are several other reasons to consider a DAF. Contributed assets are usually invested in the DAF. This means your contributions have the opportunity to grow over time, potentially increasing the impact of your giving. Many DAF providers offer tools and resources to help donors research and select charitable organizations, which can help ensure your contributions go to reputable and effective organizations. DAFs also can be an effective way to support smaller, local charities that may not have the infrastructure to handle complex donations, such as gifts of appreciated securities. Finally, DAFs often accept a wide range of assets, including stocks, real estate, and privately held business interests; this flexibility can be advantageous for donors with complex financial portfolios.

    It’s important to note that DAFs are subject to certain regulations and guidelines. Be sure to choose a reputable DAF provider and consult with financial and tax professionals to ensure you are utilizing the fund in a way that aligns with your philanthropic goals and complies with tax laws.


    As you embark on your year-end giving journey, remember to consult with a tax professional or financial advisor to ensure that your strategies are tailored to your unique financial circumstances. With their guidance, you can navigate the complexities of tax laws and philanthropic endeavors to make the most of your charitable giving.

    And finally, remember that the true essence of year-end giving extends beyond the numbers. It’s about making a positive difference, fostering a sense of community, and creating a legacy of compassion and generosity. It’s about aligning your financial goals with your values, leaving a lasting impact, and finding joy in the act of giving.

    Means Wealth Management is a registered investment adviser. The opinions expressed herein are those of the firm and are subject to change without notice. The information in this material is for educational purposes only and is not intended to act as individualized tax, legal, financial, or investment advice.