Philanthropy has always been about more than generosity. When approached thoughtfully, charitable giving can reflect your values, strengthen your community, and play a meaningful role in your broader financial picture.
As tax policy evolves, the way gifts are structured matters more than ever. Strategic philanthropy helps ensure your dollars go further for the causes you care about, while also aligning with your long-term goals. Both one-time and continuous giving can be viable options in a donor’s plan. Below are four charitable giving strategies to consider.
Itemized vs. Standard Tax Filing
Beginning in 2026, charitable deductions for itemized filers will be subject to a 0.5% adjusted gross income floor. This means smaller donations may no longer generate the same tax benefit they once did, and larger or more concentrated gifts may be required to realize meaningful deductions. For individuals who itemize, this shift may create an opportunity to be more intentional with timing and gift size.
For those who take the standard deduction, current rules allow cash charitable contributions of up to $1,000 for single filers and $2,000 for joint filers to be deducted. In these cases, cash gifts can still be an effective way to support charitable organizations while receiving a modest tax benefit. Small stock donations are less effective for standard filers, but may help reduce your taxable income.
You can learn more about how charitable contributions are treated for tax purposes on the IRS website at irs.gov.
Charitable Remainder Unitrusts
A Charitable Remainder Unitrust, or CRUT, can be a powerful option for individuals with highly appreciated assets held in taxable accounts. CRUTs are funded by moving these appreciated securities into the CRUT. By contributing those assets to a CRUT, donors may avoid immediate capital gains taxes, receive a charitable deduction in the year of contribution, and create an income stream for themselves or their beneficiaries for a defined period of time.
At the end of that period, the remaining assets are distributed to the designated charitable organization. This structure can be particularly appealing for those who want to balance current income needs with long-term philanthropic impact.
Donor-Advised Funds
Donor-advised funds continue to be a popular option for individuals who itemize and anticipate higher tax liability in a given year. By contributing appreciated securities to a donor-advised fund, donors may avoid capital gains taxes and take a charitable deduction in the year of contribution.
From there, grants can be distributed to charitable organizations over time, allowing for flexibility in how and when support is provided. This approach is often used to consolidate multiple years of giving into one tax-efficient contribution, while maintaining the ability to support causes thoughtfully and consistently. Donor-advised funds have a designated charity to receive any funds when the account owner passes.
Estate Planning and Charitable Giving
The lifetime gift and estate tax exemption is expected to increase to $15 million per person in 2026. Individuals who anticipate exceeding that threshold may want to consider charitable organizations as part of their estate plan. Assets designated for charity are excluded from the taxable estate, which can help reduce estate tax exposure while supporting meaningful causes.
Even for those unlikely to surpass the exemption amount, charitable giving can still play an important role in shaping legacy. Many account types, including but not limited to retirement accounts, life insurance policies, and annuities, can name charitable organizations as beneficiaries. Thoughtful beneficiary designations can reflect personal values and extend impact well beyond one’s lifetime.
To learn more about estate planning, read our article A Practical Estate Planning Checklist for Peace of Mind.
Bringing It All Together
There is no single right approach to charitable giving. The most effective strategies are those that reflect your goals, your values, and your overall financial picture. As policies change and opportunities evolve, coordination across tax planning, estate planning, and investment strategy becomes increasingly important.
If you are considering how philanthropy fits into your long-term plan, we invite you to start a conversation with our team by reaching out through our contact page.
Carlson Investments does not provide tax, legal, or accounting advice. This content has been written for informational purposes only. Always consult your individual tax, legal, or financial professionals for advice tailored to your situation.
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