This time of year is traditionally when all our inboxes fill with pleas from countless non-profit organization for financial support. You can find our current appeal here. We hope you will support us as you have done in the past, but crucially, there are some important changes to tax law that might be relevant to your particular situation as you plan your contributions. Here are a few things to consider:
CORPORTATE MATCHING
Don’t forget to ask! Corporations often match or exceed charitable donations made by employees. If you, or someone you know is employed by a large company, chances are their employer has a matching donation waiting to be put to good use. When making your annual donation to SCVBA, which is a 501(c)(3) non-profit, consider asking your employer for a match. If you are organizing a team for the upcoming Spring Birdathon, remember to let your teammates know their employer may offer matching funds.
STANDARD DEDUCTION
Great news! Beginning with the 2026 tax year, anyone who takes the standard deduction will be able to deduct charitable donations to qualifying 501(c)(3) public charities—up to $1,000 for single filers or $2,000 for married couples filing jointly.
A few things to keep in mind:
• This applies only to cash donations.
• The deduction amount won’t adjust for inflation in future years.
• For any gift over $250, you’ll need a written acknowledgement from the charity confirming the donation and stating that no goods or services were provided in return.
MINIMUM DISTRIBUTION
If you are 70 1/2 and required to take a Minimum Distribution from your IRA (Individual Retirement Account) or 401(k) account, you may wish to discuss with your tax advisor the potential benefits of using a Qualified Charitable Distribution (QCD). You can donate all or part of your RMD to charity and avoid paying tax on that portion of the distribution. ($108,000 is the maximum QCD amount for 2025).
A QCD could be more advantageous than using the net withdrawal proceeds for a cash donation to the charity. This QCD direct transfer to the charity from the IRA reduces your Adjusted Gross Income (AGI). Lowering AGI is beneficial for those who itemized their deductions since AGI is a limitation on the amount of Medical expenses that can be deducted. AGI is also used to determine your Medicare premium cost for the following year. The higher the AGI; the higher the premiums.
Time is short for 2025 tax planning, but a visit and discussion with your tax advisor may be very worthwhile.
Our office can assist with the transfer process.