5 Charitable Strategies That Cut Taxes More Than Writing a Check
Sam's List Editorial | 2026-06-23
5 Charitable Strategies That Cut Taxes More Than Writing a Check Most generous people give the least tax-efficient way possible. They write a check. A check is fine. It is also the version of charitable giving that leaves the most money on the table. The charitable tax strategies high income earners actually use don't change how much they give — they change what they give, when they give it, and which account it leaves from. Done right, the same gift can erase a capital gains bill, wipe out a required IRA withdrawal, or stack three years of deductions into one brutal tax year. Here's the thing nobody tells you: starting in 2026, the One Big Beautiful Bill Act added a 0.5%-of-AGI floor on itemized charitable deductions and capped the benefit at a 35% rate for vetted-bracket donors (Tax Foundation analysis of OBBBA, 2025). Translation — sloppy giving costs more than it used to. Strategy matters more than it did last year, not less. Below are five moves that beat the check. Each one is a real provision of the tax code, not a loophole. 1. The appreciated stock donation that skips the capital gains tax entirely This is the single most under-used move in personal tax planning, and it's the easiest. Say you bought stock for $20,000 and it's now worth $100,000. If you sell it and donate the cash, you owe capital gains tax on the $80,000 gain first — roughly $19,000 at the 23.8% federal long-term rate (20% plus the 3.8% net investment income tax). Then you donate what's left. Donate the shares directly instead, and two things happen. You never realize the gain, so that $19,000 tax bill disappears. And under IRC §170, you deduct the full fair market value — the whole $100,000 — not your cost basis. You gave the same asset. You just kept the tax. The catch: deductions for appreciated long-term securities are capped at 30% of your adjusted gross income (vs. 60% for cash), with a five-year carryforward for anything over the cap. So this works vetted in a year your income is high enough to absorb it. 2. Use a donor-advised fund to bunch several years of giving into one tax year The standard deduction is high enough that most people who give a few thousand a year get zero tax benefit — they take the standard deduction anyway and their gifts are invisible. A donor-advised fund (DAF) fixes that with a trick called bunching. You contribute several years' worth of giving — say five years at $20,000, so $100,000 — into the DAF in one year. You take the full deduction now, in your highest-income year, then dole the money out to charities over the following years on your own...
