Before giving, think about what matters most to you. Use tools like Charity Navigator or nonprofit websites to learn what they need, such as volunteers, supplies or operating funds. Doing your homework allows you to give with confidence, particularly if you want to avoid attaching strings so that nonprofits can put your gifts to use for their greatest needs.
2. Consider “Bunching” Gifts into a Donor-Advised Fund
“Bunching” means combining several years’ donations into one year to exceed the standard deduction for that year. This strategy has been used since 2017 to help charitable-minded individuals and couples get over the tax deduction threshold. With the new tax changes, however, the state and local taxes (SALT) deduction cap is increasing from $10,000 to $40,000, which could make itemizing easier beginning this year. One way you can take advantage of this strategy is by preloading your donations into a Donor-Advised Fund at The Dayton Foundation. This option also allows you to take the tax benefit in the year when you make your contribution, but distribute the funds to charities over multiple years if you choose.
3. Accelerate Giving if You Itemize
If you itemize, 2025 is a golden year to give. Talk to your advisor about whether you should give more to charity before the end of 2025 or put money into a DAF now. A DAF lets you set aside money for future donations but still claim the full tax deduction this year. Why does this matter? Starting in 2026, new rules will change charitable deduction limits.
You’ll need to donate at least 0.5% of your adjusted gross income before you can start deducting anything.
Example: If you make $100,000, the first $500 you give won’t count toward your deductions.
If you’re in the highest tax bracket, the deduction benefit will be capped at 35%, instead of the current 37%.
Example: A $10,000 gift saves you $3,700 in taxes this year, but only $3,500 next year.
So, by giving now or preloading a DAF, you can maximize your tax savings by avoiding the floor and/or cap that goes into effect in 2026, ultimately allowing you to give more to charity.
4. Maximize Your Giving as a Non-Itemizer
Starting in 2026, non-itemizers can deduct up to $1,000 (single) or $2,000 (married filing jointly). Ask your advisor how this might affect your giving strategy.
5. Use IRA Qualified Charitable Distributions
If you’re over 70½ years of age and have a traditional IRA, you can donate directly to charity or establish a Designated IRA Fund at The Dayton Foundation to distribute donations to your favorite charity and avoid state and federal taxes entirely. This is one of the most tax-efficient ways to give.
6. Donate Appreciated Stock
If you own appreciated stocks, consider donating them to a qualified charity instead of cash. You’ll avoid capital gains tax on the appreciation and, if you itemize, still get a charitable deduction — a double benefit.
Giving strategically means more money goes to the causes you care about and less to taxes. Talk to your advisor, crunch your numbers and make this season of giving truly impactful for the charitable causes and organizations you care about most. The Dayton Foundation also is a resource to help you help others. For more information about these and other tax-smart giving options, visit daytonfoundation.org.
Marianne Requarth is the director of development for The Dayton Foundation.
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