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Charity, donor-advised funds, volunteering, gifts to family, and the gift tax. Give more to the causes and people you choose and less to taxes.
If your itemized deductions hover just below the standard deduction threshold most years, try bunching. Concentrate two years of charitable donations or other deductible expenses into one year so you can itemize that year and take the standard deduction the next. The total giving stays the same, but the tax benefit doubles in the bunching year.
A donor-advised fund lets you contribute cash or appreciated investments, claim the full tax deduction immediately, and decide which charities to support later, all while the money grows tax-free. If you donate regularly and hold appreciated investments, you’re likely leaving real tax savings on the table. Fidelity, Schwab, and Vanguard all offer DAFs with no minimums to open.
Starting January 1, 2027, giving to a qualified Scholarship Granting Organization earns you a dollar-for-dollar federal tax credit of up to $1,700 (Treasury rules pending), not a deduction. If you owe federal income tax and already give to charity, plan to route that giving to an SGO in 2027.
If you owe federal income tax and give to education causes, put the Education Freedom Tax Credit on your 2027 calendar. Starting January 1, 2027, a contribution to a qualified Scholarship Granting Organization comes back as a dollar-for-dollar federal credit of up to $1,700 (Treasury rules pending). Register interest now, act then.
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