Giving in 2025: How to Make the Most of Your Charitable Donations
Giving to charity isn’t just about generosity—it also can be a smart financial move. Whether you're supporting your local church, a nonprofit close to your heart, or a national cause, the 2025 tax rules offer several ways to make your giving go further.
As a financial advisor, I often help clients find ways to give that align with both their values and their financial goals. Here's what you should know this year.
What’s New in 2025: Giving from Your IRA (If You're 70 1/2 or Older)
If you're over 70 1/2, in 2025, individuals can donate up to$108,000 directly from your IRA to a qualified charity. This is called a Qualified Charitable Distribution (QCD), and it:
-Counts toward your Required Minimum Distribution (RMD)
-Isn’t taxed as income
-It’s a great way to give and save on taxes at the same time.
Annual Gift Tax Exclusion
In 2025, you can give up to $19,000 per person without triggering gift tax reporting. For married couples, that’s $38,000 per recipient. This is a great way to support loved ones while reducing your taxable estate.
Lifetime Gift and Estate Tax Exemption
The lifetime exemption for 2025 is $13.99 million per person (or $27.98 million for married couples). This means you can give away a significant amount during your lifetime or through your estate without paying federal gift or estate taxes.
Easy Ways to Give: Bundle Your Donations
Consider donating a larger amount every few years instead of smaller amounts annually. This can help you qualify for itemized deductions and get a bigger tax break.
Donate Stocks or Property
If you own investments that have gone up in value, donating them directly to charity can help you:
- Avoid paying capital gains tax
- Get a deduction for the full market value (if held for more than one year)
Use a Donor-Advised Fund
Think of this like a charitable savings account. You put money in now (and get the tax deduction), then decide later which charities to support. It’s flexible and strategic.
Giving That Fits Your Legacy
Charitable giving can also be part of your estate plan. You can:
- Name a charity as a beneficiary of your retirement account
- Include donations in your will
- Set up a trust that gives to charity and provides income to you or your family
Final Thoughts
Giving is personal—but it can also be powerful. You can support the causes you care about while making financial decisions for yourself and your family.
If you’re thinking about giving this year and want to make sure it’s done wisely, I’d be happy to help you explore your options.
Together, we can work to keep you on-track toward your financial goals.
Request a consultation to learn more.
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