Tax · 7 min read
Charitable Giving Tax Planning
Charitable giving is one of the few deductions taxpayers fully control. The trick is choosing what you give, when you give it, and which vehicle you give through.
Deduction rules to know
- Only itemizers benefit from cash gifts — if you take the standard deduction, the write-off is zero
- Cash gifts to public charities are generally deductible up to 60% of AGI
- Appreciated long-term stock gifts are deductible at fair market value, up to 30% of AGI, with no capital gains tax
- Non-cash gifts over $500 require Form 8283; over $5,000 generally need a qualified appraisal
Bunching strategy
If your itemized deductions hover around the standard deduction, bunch two or three years of charitable gifts into one tax year so you itemize that year, then take the standard deduction in the off years. A donor-advised fund (DAF) lets you deduct the lump sum now and grant to charities over time.
Give appreciated assets, not cash
- Donate long-term appreciated stock instead of selling — avoid capital gains and deduct fair market value
- Works for publicly traded stock, mutual funds, and many crypto positions held >1 year
- Avoid donating depreciated assets — sell, deduct the loss, then donate cash
