By Jeremy A. Wechsler, Esq.
Investment Advisor Representative
[email protected]
As we head into the holiday season, charitable giving is on the minds of many. Whether you support a favorite nonprofit, your church or synagogue, or a local cause, there are several tax-efficient strategies that can stretch your impact. The most important thing to know is that there are multiple strategies, and it really depends on what your goal is and what assets you’re looking to gift. Below, I have written about a few options to consider, but talk to your advisor if you have questions about which strategy may be best for you.
1. Qualified Charitable Distributions (QCDs)
If you’re age 70½ or older, a QCD is one of the best ways to give. Instead of taking money from your IRA, paying tax, and then donating it, you can send funds directly from your IRA to a charity. In 2025, the limit is $108,000 per person, per year. In 2026, the limit increases to $111,000 per person. Notably, QCDs also count toward your RMD, helping lower your taxable income. Just remember: the gift must go directly from the IRA to the charity, and donor-advised funds don’t qualify.
2. Donor-Advised Funds (DAFs)
A DAF works like a charitable investment account. You contribute cash or appreciated stock, take the tax deduction immediately, then make gifts to charities over time. This is ideal in high-income years or when front-loading giving makes sense.
3. Donating Appreciated Stock
Instead of writing a check, gifting investments you’ve held a long time allows you to avoid capital gains tax, and receive a tax deduction for the full fair market value. For appreciated assets, this is often the smartest way to give.
4. Naming Charity as an IRA Beneficiary
If you plan to leave something to charity in your estate, consider naming a nonprofit directly on your IRA. Charities pay no income tax on IRA dollars—your heirs do—so this simple step can save significant taxes.
To conclude, the right strategy depends on your income, assets, and goals. If you’re thinking about year-end giving or want to build a long-term charitable plan, reach out anytime. There are many ways to be generous—and some are far more tax-efficient than others.
From our family to yours, hope you have a wonderful Thanksgiving holiday, however you celebrate!