5 Most Important Tips for Year-End Charitable Giving
By As the holiday season approaches, generosity often tends to take center stage, and for good reasons. Giving back not only supports the causes you care about, but it can also provide potential tax advantages before the year wraps up. Whether you give regularly or are considering a larger year-end contribution, here are a few strategies that can help make your charitable dollars go further.
1. Give Appreciated Assets Instead of Cash
If you’ve held investments like stocks, mutual funds, or ETFs that have increased in value, consider donating them directly to a qualified charity. Doing so may allow you to avoid paying capital gains taxes on the appreciation, while still claiming the full fair market value as a charitable deduction. It’s a win-win for both you and the organization you support.
2. Use a Donor-Advised Fund (DAF)
A donor-advised fund can be a powerful tool for those who want to make a meaningful impact without rushing to choose specific charities before Dec. 31. You can contribute to a DAF now, claim an immediate deduction for 2025, and recommend grants to charities over time. This flexibility makes it ideal for long-term charitable planning.
3. Make Qualified Charitable Distributions (QCDs) from Your IRA
If you’re age 70½ or older, you can donate up to $108,000 per year directly from your IRA to a qualified charity. These distributions count toward your required minimum distributions (RMDs) but are generally excluded from taxable income — a particularly effective strategy for retirees looking to reduce taxes on retirement withdrawals.
4. Keep Good Records
The IRS requires proper documentation for all charitable gifts, whether cash or non-cash. Be sure to keep donation receipts, acknowledgment letters from charities, and any records of non-cash contributions. For gifts over $250, written confirmation from the charity is required to claim a deduction.
5. Give Strategically — Not Spontaneously
While giving should come from the heart, a little planning can maximize your impact. Talk with your financial advisor or tax professional before year-end to determine which giving strategies best align with your tax situation and overall financial goals. This ensures your generosity helps others while also supporting your own financial foundation.
The Bottom Line
Charitable giving can be one of the most rewarding parts of your financial plan, both emotionally and financially. Taking time before Dec. 31 to give strategically may help you maximize your impact, reduce taxes, and end the year knowing your resources made a real difference. This is something our advisors at Family Financial Planners can help you with. Reach out today and let us help you make a plan.
This information is for general educational purposes only and is not intended as tax, legal, or investment advice. Consult your financial advisor or tax professional regarding your individual situation.
Article by Dillon Harper, Wealth Advisor at Family Financial Partners — a financial services firm in Lexington, Kentucky.