Major tax law changes are coming in 2026 that could significantly affect how much you can deduct for charitable contributions. If you're looking to maximize tax benefits while making a lasting impact, now is the time to act.

Here’s how you can prepare with smart charitable giving strategies before the rules change.

What tax changes are coming in 2026?

Starting January 1, 2026, several provisions from the 2017 Tax Cuts and Jobs Act are set to expire. This will likely result in:

• Higher federal income tax brackets
• Lower standard deductions
• Reduced opportunities for itemizing deductions

These changes mean that taxpayers may lose out on valuable charitable giving deductions if they wait too long.

How can I maximize charitable deductions before 2026?

You can take advantage of current tax laws by using strategies that increase your deduction potential in 2025. These include:

1. Should I bunch my charitable contributions?

Yes. Bunching deductions involves consolidating several years’ worth of charitable donations into a single tax year. This helps you exceed the itemized deduction threshold and maximize your tax savings.

2. What is a Donor Advised Fund (DAF), and how can it help?

A Donor Advised Fund allows you to make a large, tax-deductible contribution in 2025 while distributing the funds to charities over several years. This provides immediate tax benefits and long-term giving flexibility.

3. What are Qualified Charitable Distributions (QCDs), and who can use them?

If you’re age 70½ or older, you can make Qualified Charitable Distributions of up to $105,000 directly from your IRA to a qualified charity. This satisfies your Required Minimum Distribution (RMD) without increasing your taxable income.

4. Is it better to donate cash or appreciated assets?

Donating appreciated assets like stocks or mutual funds is usually more tax-efficient than donating cash. You avoid capital gains taxes and can deduct the full fair market value of the assets.

5. When should I consider a charitable trust?

If you have significant wealth or legacy planning goals, a charitable trust can offer fixed income or estate benefits while providing a current-year deduction. It's ideal for long-term philanthropic strategies.

What are common mistakes to avoid when giving charitably?

Here are four errors that can reduce your tax benefits:

• Waiting until the end of 2025: Delays may cause you to miss more favorable current rules.
• Giving cash instead of appreciated assets: You lose the capital gains tax advantage.
• Mishandling QCDs: These must go directly to the charity—not to you first.
• Not involving your advisor or CPA: Tax-smart giving should align with your full estate and financial plan.

What’s an example of a successful charitable giving strategy?

Hypothetical Case Study:

A family donated $400,000 in appreciated stock to a Donor Advised Fund in 2025.

• Capital gains tax saved: ~$90,000
• Benefit: They received a large 2025 deduction and gained the flexibility to support charities over multiple years.

This is a great example of how strategic planning can lead to meaningful tax savings and philanthropic impact.

What should I do now to prepare for the 2026 tax changes?

Act now to take advantage of the more generous 2025 rules. The best way to ensure you're optimizing your charitable contributions is to work with a tax advisor or financial planner. They can help you decide which strategy is right for your goals and financial situation.

Talk to your advisor today, or schedule an introductory call to learn more about our tax consulting services. 

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