Humans are generous, even if it might not seem that way when someone steals your parking spot at the grocery store or takes the last complimentary treat in the break room. Giving USA 2024: The Annual Report on Philanthropy for the Year 2023, estimates that $557.16 billion was donated to U.S. charities in 2023 with $374.40 billion coming from individuals. That means roughly 67% of charitable donations in the year 2023 came from individuals. Do we give because of societal pressures, evolutionary instinct, personal ethos, or higher calling? I’m not sure, but nonetheless, we give.

So, if you’re someone who donates, let’s make sure you understand some of your giving options.  

Choosing the Right Charitable Giving Methods

Appreciating Assets: The Gift that Keeps on Giving (and Saving)

Instead of giving cash, you can donate assets that have appreciated in value like stocks, real estate, or even a fine wine. This technique can be more tax efficient for you and increase the overall amount granted to the charity.

Donor-Advised Funds: For Simplified Recordkeeping

A Donor-Advised Fund (DAF) is a dedicated charitable investment account that allows you to receive an immediate tax deduction as soon as you contribute. Funds in a DAF then grow tax-free and can be distributed to qualified charities over time. You open this type of account through a custodian like Charles Schwab or Fidelity and they can have annual fees associated with their maintenance.  

Qualified Charitable Distributions: The Retiree’s Power Move

For those aged 70 ½ or older, there’s a special tool in your philanthropic toolbox: Qualified Charitable Distributions (QCDs) from traditional IRAs. You can donate up to $108,000 (for 2025) tax-free to charities. This is an excellent way to fulfill Required Minium Distributions without increasing your taxable income. Since a QCD isn’t included in your taxable income it’s a powerful donation option, especially for those who don’t itemize their taxes.

Understanding and applying strategic charitable giving methods can amplify the benefits for both you and the recipients. Whatever motivates you to give, we want you to do so – as an informed donor!