Charitable Contributions PSA

PSA: consider pulling in charitable contributions to the next few weeks that you were considering making next year.

First off, an important disclaimer. I am not a qualified professional, licensed tax professional, lawyer, or financial advisor. If you have one, you should consult them. Nothing here should be construed as financial, investment, or legal advice.

There are some large changes coming January 1 with OBBBA regarding how charitable contributions can be deducted. If you are a high earning filer who contributes to charity regularly and itemizes your deductions, you probably need to take a moment right now to do a bit of research.

The first 0.5% of your AGI will no longer be deductible as a contribution. Additionally charitable contributions will be capped at the 35% bracket vs 37%. This overall suggests a new strategy of “batching” donations into high giving years and just claiming a standard deduction in off years.

If you have a Donor Advised Fund (DAF), I’d take a look at “pulling in” contributions you were planning to make next year to get the full 2025 benefit. If you don’t, I’d recommend either opening one (it’s pretty easy to do and costs nothing; we use Schwab) or simply directly contributing to your favorite charities early - making your 2026 donation in 2025.

If you’re thinking about getting involved in charitable giving but aren’t sure where to start, I’m very happy to be a resource for you and your family. It can be incredibly gratifying to see real positive impact in your community and in the world from your giving.