Year-End Giving: How to Maximize Your Charitable Impact Before December 31

The Year-End Giving Window

December is the most important month for charitable giving. Nearly one-third of annual donations happen in the last month of the year, with 10% occurring in the final three days alone. If you're planning to give before year-end, strategic timing can maximize both your impact and your tax benefits.

Disclaimer: This article is for informational purposes only and does not constitute tax advice. Please consult with a qualified tax professional for guidance specific to your situation.

Key Deadlines You Need to Know

December 31, 2025: The absolute deadline for 2025 tax-deductible donations.

For a donation to count toward your 2025 taxes:

Cash donations: Must be postmarked by December 31 or completed online by 11:59 PM your time zone
Credit card gifts: Processed date determines tax year, not statement date
Check donations: Must be mailed (postmarked) by December 31
Stock donations: Must be received by the charity before year-end
DAF grants: Must be recommended and approved by December 31

Corporate matching deadlines: Many companies have earlier deadlines (often December 15-20) for matching gift requests. Check with your HR department immediately if you want matching.

Strategy 1: Donation Bunching

The 2017 Tax Cuts and Jobs Act nearly doubled the standard deduction, meaning fewer taxpayers itemize. If your total itemized deductions hover near the standard deduction, "bunching" can help.

How it works:

Instead of giving $5,000 each year, give $10,000 every other year. In the giving year, you exceed the standard deduction and itemize. In off years, you take the standard deduction.

Example (2025):

Standard deduction: $15,000 (single) or $30,000 (married filing jointly)
Without bunching: $5,000 annual donation provides no additional deduction if other itemized deductions don't reach threshold
With bunching: $10,000 donation plus other deductions may exceed threshold, providing tax benefit

Pro tip: Donor-advised funds (DAFs) make bunching even easier—contribute a large amount to your DAF this year for the tax deduction, then grant to charities over multiple years.

Strategy 2: Qualified Charitable Distributions (QCDs)

If you're 70½ or older with an IRA, Qualified Charitable Distributions are one of the most tax-efficient ways to give.

Benefits:

Up to $105,000 can be donated directly to charity from your IRA (2025 limit)
The distribution counts toward Required Minimum Distributions (RMDs)
The amount isn't included in your taxable income
Works even if you don't itemize

How to execute:

Contact your IRA custodian to arrange a direct transfer
The check must be made payable to the charity (not you)
Request the transfer by mid-December to ensure processing
Obtain acknowledgment from the charity for your records

Important: QCDs cannot be made to donor-advised funds or private foundations.

Strategy 3: Appreciated Securities

Donating stocks, mutual funds, or ETFs that have increased in value is often more tax-efficient than donating cash.

Double benefit:

You receive a deduction for the full fair market value
You avoid paying capital gains tax on the appreciation

Example:

Stock purchased for $3,000 now worth $10,000:

If sold first: You pay ~$1,400 in long-term capital gains tax (20%), then donate $8,600
If donated directly: Full $10,000 deduction, zero capital gains tax, charity receives full value

Requirements:

Securities must have been held more than one year
Donation limited to 30% of AGI (vs. 60% for cash)
Process takes time—initiate by December 15

Strategy 4: Don't Forget Matching Gifts

Corporate matching programs essentially double your donation—free money for the causes you care about. Yet billions in matching gift funds go unclaimed every year.

Action steps:

Check if your employer has a matching gift program
Verify the deadline (often earlier than December 31)
Submit your matching gift request for all 2025 donations
Some companies also match spouse donations or retiree gifts

The Chahal Foundation is a registered 501(c)(3) organization eligible for most corporate matching programs. Our EIN: [available upon request].

Strategy 5: Required Minimum Distribution Planning

If you're 73 or older and subject to RMDs, you can reduce tax burden through charitable giving:

Options:

QCDs (described above) directly from IRA
Take RMD, then donate (if you itemize)
Consider if RMD pushes you into higher tax bracket

Planning note: First-time RMDs can be delayed until April 1 following the year you turn 73, but that creates two RMDs in one year. Plan accordingly.

Making Your Gift Count: Beyond Tax Benefits

While tax strategy is important, remember that the real value of charitable giving is the impact you create. When choosing where to direct your year-end giving:

Consider:

Organizations with proven track records and transparent financials
Causes aligned with your values and priorities
Charities that demonstrate measurable outcomes
Groups where your contribution makes a meaningful difference

At The Chahal Foundation, we maintain:

85% of donations go directly to programs
Audited financial statements available publicly
Detailed impact reports for all donors
Multiple giving options to fit your situation

Your Year-End Giving Checklist

This week:

[ ] Review your 2025 giving to date
[ ] Calculate if itemizing makes sense
[ ] Check corporate matching deadlines
[ ] Identify appreciated securities for donation

By December 15:

[ ] Initiate stock transfers
[ ] Request QCD from IRA custodian
[ ] Submit corporate matching requests

By December 31:

[ ] Complete all online and credit card donations
[ ] Mail any check donations (postmark counts)
[ ] Make DAF grant recommendations
[ ] Save confirmation emails for tax records