AI has already affected how we learn, work and govern ourselves much faster than research, regulation or nonprofits can keep pace.

While businesses and governments scramble to respond, philanthropists hold a distinct and underutilized advantage: The flexibility to fund what others won't, invest where we still need evidence and work across sectors without commercial pressure.

Here is how to leverage your advantages as a donor.

1. Sharpen your nonprofit due diligence

AI-generated misinformation makes vetting organizations harder than ever. Donors can raise their standards by:

• Identifying ratings from Charity Navigator, the BBB Wise Giving Alliance and GuideStar's Seals of Transparency before committing funds
• Visiting local organizations in person — no rating system replaces direct observation of a program in action
• Asking nonprofits you regularly support how they manage AI-related data risks before your next significant gift conversation

2. Fund nonprofit AI capacity — not just programs

Most nonprofits use AI primarily for basic productivity: Drafting emails, summarizing meetings, writing grant applications. The real leverage lies in mission-critical AI deployment — but getting there requires infrastructure most nonprofits lack, and the risks of moving forward without it remain severe.

Unlike corporations, nonprofits face the same cybersecurity vulnerabilities with far fewer resources. They routinely manage donor financial data, personally identifiable information, health records and confidential beneficiary files.

Large language models like ChatGPT and Claude collect and store user data indefinitely — meaning a nonprofit that uploads sensitive files to an AI platform may lose ownership of that data entirely.

Cybercriminals also actively use AI to make attacks harder to detect. A single breach can devastate fundraising, damage community trust and trigger regulatory consequences under state, federal or international privacy law.

To empower nonprofits to function effectively with AI, you may:

• Fund general technology budgets. IT infrastructure upgrades remain chronically underfunded, yet are essential for safe and effective AI use. Consider directing unrestricted gifts specifically toward this gap.
• Sponsor AI education and policy development. Nonprofit leaders identify four priorities: Staff training on AI fundamentals, dedicated software funding, technical development opportunities and guidance on how AI affects the communities they serve.

As a result, you can free up charities to make truly transformational changes. For instance, the MacArthur Foundation's recent $100 million award funded an AI-driven global infectious disease surveillance system, a model for what becomes possible with the right infrastructure in place.

3. Support publicly available AI research

It has become clear that AI will affect jobs across every sector — augmenting some roles, restructuring others and eliminating others. Yet workforce impact data remains fragmented, with no uniform standards for measuring AI exposure, adoption or economic effect across sectors.

Educators and employers commonly agree that student preparation for an AI-embedded future entails independent decision-making, problem-solving and media literacy, rather than task completion. In essence, students need to be taught how to think, not what to think.

However, educators have had to make high-stakes technology adoption decisions with insufficient evidence.

As labor markets shift, demand will rise for portable access to healthcare, education and job retraining.

For instance, potential ideas such as portable benefits, decoupling health insurance and retirement savings from traditional employment, require rigorous, publicly available research to move from concept to viable policy.

As a result, AI research remains "in the first inning."

Donors can accelerate the learning curve to keep up with industrial changes by:

• Funding research based on multiple perspectives, including those of teachers, parents and students, on AI's impact on learning
• Prioritize studies that remain open to the public, so other researchers can replicate and build on findings
• Support workforce transition research, particularly around portable benefits and safety-net access for workers in AI-disrupted industries

4. Strengthen civic voices in developing AI policy

Most workers and communities recognize the efficiencies offered by AI, understand their benefits and don't want to eliminate them.

Instead, they simply want a seat at the table in deciding how AI applies to them. In fact, more than half of U.S. adults (55%) say they want greater control over AI in their lives.

That demand extends to transparency about AI's environmental footprint and corporate accountability on data privacy.

Philanthropy has a direct role in amplifying a community's civic voice by:

• Funding local and independent journalism to ensure communities receive accurate, accessible information about AI's local implications
• Supporting civic participation initiatives that bring residents, not just industries, into community-level AI policy and land-use decisions

5. Align your financial investments with your philanthropic goals

Ideally, your investment portfolio and your philanthropic priorities would reinforce, and not negate, each other. Accounting for environmental, social and governance factors may improve long-term returns by unlocking value and achieving resilient, long-term investment success.

You can adjust your investment and philanthropy alignment by:

• Reviewing your current AI-related holdings and their impacts in the areas that you care about most as a philanthropist
• Consulting with your investment adviser on frameworks for considering environmental, social and corporate governance factors

6. Team up with other donors

AI's societal scale exceeds what any single donor can address. Philanthropists who coordinate with peers can multiply their impact, reduce duplication and gain access to shared due diligence.

In collaborating with other donors, you may:

• Explore foundation coalitions like Humanity AI to review their vetted grantee list and potentially identify organizations aligned with your priorities
• Join or convene a donor working group focused on AI's impact in your areas of giving — education, workforce, health or civic participation

The philanthropists who move now can help influence AI for good. In funding research, nonprofit capacity and broad civic engagement and working with other donors, you can advance the positive impact of AI and mitigate its challenges for decades ahead.

Related Content

• The Future of Philanthropy Is Female: How Women Will Lead a New Era in Charitable Giving
• Five Ways to Adapt Your Charitable Giving Strategy in a Changing World: An Expert Guide
• Give More But Pay Less: An Essential Guide to Tax-Smart Charitable Giving in 2026
• 3 Major Changes to the 2026 Charitable Deduction
• How the One Big Beautiful Bill Will Change Charitable Giving

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Research shows that most high-net-worth (HNW) clients are already charitable. They donate to causes they care about, support organizations in their communities and often want philanthropy to play a meaningful role in their legacy.

Yet many lack a cohesive giving strategy that ties charitable giving to clearly defined objectives and integrates within their broader financial and estate plans. Bridging the gap between intention and strategy is where advisers can provide real, differentiated value.

Recent data highlights how much HNW clients really value these discussions. According to the 2026 TPI Study of The Philanthropic Conversation, 88% of HNW clients consider it important to discuss philanthropy with their advisers, and 80% believe advisers have a professional or ethical responsibility to raise the subject.

Advisers have largely caught up to that expectation: 96% now view it as their obligation, a significant increase from 62% in 2018. The alignment is there, but the next step is ensuring these discussions move from one-off, year-end conversations into a consistent bullet point on the planning agenda.

1. Understand what motivates clients to give

Before diving into giving vehicles and technical solutions, the first step in helping clients build a strategic giving plan is understanding why they are motivated to give in the first place.

Advisers often assume clients' philanthropy is driven primarily by tax considerations, but the data suggests clients are most motivated by purpose and impact rather than deductions.

The TPI study found a notable disconnect between adviser perceptions and client priorities. Advisers identified "being an inspiration to others" as the top motivation for charitable giving, while clients ranked "making an impact" highest.

Furthermore, 40% of advisers cited taxes as a key motivator, compared to only 21% of clients.

For advisers, philanthropy offers a unique opportunity to connect with clients on a deeper level beyond portfolio performance and investment returns.

Asking targeted questions around charitable goals often reveals what clients care about most, and uncovers personal aspirations, legacy goals and family dynamics that may not come up during traditional financial planning meetings.

When clients feel understood on that level, the adviser relationship becomes more meaningful and durable.

2. Match giving vehicles to goals

Once a client's motivations and priorities are clear, the next step is helping them select the charitable giving vehicles and strategies that best support their goals.

According to the TPI study, 34% of clients are interested in integrating charitable objectives into their broader wealth management plans, reflecting a growing desire for philanthropy to be intentional rather than reactive.

Different charitable vehicles serve different purposes, and the right approach depends on the client's goals, assets and desired level of involvement.

• Donor-advised funds (DAFs) suit clients who want flexibility, simplicity and an immediate tax deduction without the administrative obligations of a foundation.
• Private foundations make sense for clients seeking more control, a vehicle for multigenerational family engagement, and the ability to make grants, run programs or invest mission-aligned capital.
• Planned giving programs, including charitable trusts and bequests, work well for clients integrating philanthropy with estate and legacy planning.

It often makes sense for donors to use a combination of giving vehicles. Private foundations and DAFs are especially synergistic, providing more ways to give and maximizing financial outcomes.

Overall, moving from ad hoc donations to a more programmatic approach through structured vehicles makes it easier to incorporate philanthropy into a financial plan and enables steadier streams of funding for nonprofits.

3. Measure progress and impact

As philanthropy becomes more intentional, many donors want greater clarity on the impact of their charitable giving, but measuring that can be difficult.

According to the 2026 Foundation Source Donor Survey, 27% of donors identify impact measurement as a top challenge, while 33% say it is an area of strong interest.

Advisers can play an important role by helping clients define what success looks like from the outset. For some, success may mean donating a certain dollar amount annually or supporting a specific number of organizations.

For others, it may involve measurable outcomes tied to a specific cause, such as scholarships funded, families served or conservation goals achieved.

Strong relationships between donors and grantees can make a meaningful difference, too. Donors who engage regularly with the organizations they support often have a clearer view of how their grants are being deployed and the impact they have.

Encourage clients to maintain an ongoing dialogue with grantees — an open line of communication can foster a more collaborative environment and lead to more insight into results.

Just as importantly, charitable planning discussions should not happen only once a year. Embedding philanthropy into regular planning meetings allows advisers and clients to revisit goals throughout the year and better track progress.

Donors are becoming more deliberate about how they give and want it to feel purposeful, not piecemeal. Advisers have the opportunity to help clients structure their giving strategically to reflect personal values, involve the next generation, and sustain across market cycles and policy changes.

When you help a client turn charitable intentions into a structured giving strategy, you're not only serving their charitable mission, but also building the kind of relationship that lasts for generations.

The 2026 TPI Study of the Philanthropic Conversation was conducted between December 2025 to January 2026 among 300 professional advisors who advise high-net-worth (HNW) clients (those with $5 million or more in investable assets) and 103 HNW clients who participate in philanthropy. The study was co-sponsored by Foundation Source and DAFgiving360, with support from The Boston Foundation.

Related Content

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• A Financial Planner Takes a Deep Dive Into How Charitable Trusts Benefit You and Your Favorite Charities
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• How to Maximize Your Impact With Strategic Philanthropy Tools
• Every Dollar Counts: How to Evaluate a Nonprofit

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Happy Pride!

Many of us will be celebrating the achievements of the LGBTQ+ community this month. But it's equally important we show our support all year long.

Over the past year, I have thought carefully about how I show up for the LGBTQ+ community. In my work as a financial planner, I advise LGBTQ+ clients on their personal financial plans and educate my peers on the nuanced financial challenges and opportunities facing this community.

I stay informed through LGBTQ+ focused news and research, and I regularly share relevant insights in professional and personal conversations.

I also follow and support organizations doing critical work nationally, including The Trevor Project, HRC, GLAAD and PFLAG, as well as local community-based organizations like Out Montclair, the Melrose Human Rights Commission and BAGLY.

But when I stepped back and took an objective look at my finances, I discovered something interesting. Sure, I donate to LGBTQ+ groups, but my charitable giving tends to be reactionary — in response to a crisis, shocking news stories or social media campaigns.

This realization matters because how we give is as important as why we give.

How charitable giving strategy shapes LGBTQ+ impact

The way many of us give follows a similar pattern. According to the Voices for Good Report, 45% of donors give reactively when moved by crisis events, matching campaigns or social media requests. These donations tend to be smaller and one-off.

Reactive generosity plays a vital role. It helps address immediate harm and urgent need. But when reactive giving becomes the primary funding model, nonprofit organizations are left without the stability they need to plan, hire and serve effectively.

For LGBTQ+ organizations, this instability is especially pronounced.

According to The Equitable Giving Lab, only 0.17% of total charitable giving in the U.S. went to LGBTQ+ organizations in 2022. That's less than $0.20 of every $100 donated.

In June 2025, a report revealed a decline in donations to LGBTQ+ organizations in 2023. Donations from the 20 largest funders accounted for nearly 46%, while their donations decreased by 24%.

This creates a dilemma when funds are centralized yet unstable. Projects take longer to begin. People lose their jobs. The leaders spend much time raising funds rather than providing services to the community.

The problem does not lie in generosity, but in the system.

Why recurring LGBTQ+ giving matters

Regularly scheduled gifts result in predictable revenue. This enables organizations to plan effectively, maintain staff, grow their programs and prepare for potential disasters without financial stress.

For the donor, regular giving results in alignment. Instead of allowing your principles to guide impulsive decisions, you can turn them into a habit, like other aspects of successful financial management.

While giving just $25 each month may seem like a small amount, for example, it adds up to $300 a year. If you're wealthy and can donate much more, regular charitable giving can be both generous and strategic.

How to build a long-term LGBTQ+ giving strategy

If you want to move from reactive donations to sustained LGBTQ+ philanthropy, start with a simple framework.

1. Do your homework

LGBTQ+ community organizations have varied roles. They may be involved in youth crises, provision of counseling services, healthcare, housing, education and other community-building activities. Research not only national organizations but also those operating in your immediate environment.

2. Prioritize your donations

Donate to one or two organizations depending on the similarity between their mandate and yours. It is usually better to prioritize a few organizations and donate consistently rather than spreading donations around.

3. Make regular contributions

Identify an amount that you can contribute consistently, regardless of economic changes.

Tax smart strategies for LGBTQ+ charitable giving

Donors who earn higher incomes or have substantial assets find that their philanthropic efforts are best realized within a comprehensive, tax-efficient financial strategy.

Start with structural fundamentals

• Confirm the organization is a 501(c)(3) so contributions are tax deductible
• Review transparency and governance before deploying significant capital
• Understand how ongoing funding supports core programs

Use appreciated assets instead of cash

Donating appreciated publicly traded stock or qualifying private investments means you can:

• Avoid long-term capital gains tax on appreciation
• Receive a deduction equal to fair market value
• Increase net dollars reaching the organization

This approach can meaningfully outperform cash giving, particularly following strong market years or liquidity events.

Incorporate charitable vehicles for flexibility and scale

As giving grows, structure matters. Two commonly used vehicles are private foundations and donor-advised funds (DAFs).

Private foundations offer maximum control and formal governance:

• The commonly suggested minimum contribution is $1-2 million
• There's no legal maximum contribution limit
• Foundations require legal formation, administration and annual compliance
• They must distribute at least 5% of non-charitable use assets annually
• They may be subject to excise taxes
• Charitable deduction limits are lower than direct gifts or DAFs
• They're often appropriate for donors seeking multigenerational involvement and formal legacy planning

DAFs provide efficiency and flexibility:

• Contributions are irrevocable and tax deductible in the year funded
• Assets can be invested and grow tax free
• Fees are typically low
• Grants can be made immediately or over multiple years
• They're well suited for coordinating giving with liquidity events, income spikes and long-term legacy planning

Both tools allow donors to deploy capital intentionally across market cycles while supporting consistent LGBTQ+ nonprofit funding.

Pride is about commitment

Pride began as a protest and continues as a celebration. It is sustained through commitment.

In order for these groups to remain relevant next year, in five years, and even 10 years from now, they require stable funding beyond periods of charity. Progressing from one-off donations to consistent and systematic LGBTQ+ giving ensures sustainability across the board.

For donors who are balancing their career income, concentrated stock positions or the sale of a business, a charitable planning strategy can make an impact. Coordinating your LGBTQ+ giving with tax planning, investment management and estate planning helps ensure your generosity is tied to your long-term financial security.

During this Pride Month, think about how you can use your finances not only to increase awareness, but also to guarantee longevity within the LGBTQ+ community.

While Pride is celebrated throughout June, supporting the LGBTQ+ community should be year-round.

Related Content

• How To Financially Support LGBTQ+ Causes This Pride Month — And All Year Long
• Retirement Reimagined: Finding Your Tribe in LGBTQ-Focused Communities
• An Expert Guide to Keeping Your Charitable Giving Momentum Going All Year
• I'm a Financial Planner: Here Are Three High-Impact Ways to Make a Difference With Your Dollars
• April Brings Showers, Flowers and Your Financial Fitness Plan From a Financial Planner

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As we near retirement, we're often told that we'll pay less in taxes once we've retired. But is that always the case?

For some, yes, but for many, I would contend that you'll pay just as much, if not more, in taxes in retirement than you did in your pre-retirement years.

Some people have misconceptions about taxes and retirement. They believe their income will drop significantly but ignore that taxable withdrawals from retirement accounts and other income sources could put them in a higher tax bracket.

Others fail to seek tax advice as they near retirement and don't plan proactively, resulting in the lack of a tax-efficient, long-term distribution strategy.

The complexity of tax laws and how they differ for various accounts and investments is another contributing factor to unforeseen tax liabilities.

Here are some financial aspects of retirement that can lead to a tax trap.

Your lifestyle

Most experts recommend planning to replace 75% to 85% of your pre-retirement annual income to maintain your current lifestyle. While expenses such as commuting or saving for retirement might drop, others, such as healthcare and leisure (travel, entertainment, hobbies, social activities, etc.), often increase.

Without a significant reduction in expenses, you'll need to have an income similar to your later working years, likely keeping you in the same tax bracket.

Social Security

Up to 85% of your Social Security benefits can be taxable, depending on your combined or provisional income, a specific IRS formula used to determine whether Social Security benefits are taxable.

It's calculated by adding your adjusted gross income (wages, interest, dividends, pensions, capital gains and retirement account withdrawals), nontaxable interest (typically, interest from tax-exempt bonds, such as municipal or government bonds) and half the total gross Social Security benefits received during the year.

That combination could create a "tax domino effect" if you withdraw money for living expenses and unintentionally trigger higher taxes on your Social Security.

Here are the income thresholds at which Social Security benefits become taxable:

Medicare

Medicare premiums can increase due to the income-related monthly adjustment amount (IRMAA). That's an extra, income-based surcharge added to Medicare Part B (medical) and Part D (prescription drug) premiums for individuals with higher incomes.

For 2026, single tax filers with a modified adjusted gross income (MAGI) above $109,000 and joint filers above $218,000 are subject to IRMAA. The Social Security Administration uses tax returns from two years prior to determine if the additional fee applies.

Required minimum distributions (RMDs)

RMDs, which for most people begin at age 73 (it's age 75 for those born 1960 or later), could push you into a higher tax bracket. At those ages, the federal government requires people to make withdrawals from tax-deferred, pretax retirement accounts that they built over decades of their working life.

Those accounts include 401(k)s, 403(b)s, 457(b) plans, traditional IRAs, SEP IRAs, SIMPLE IRAs and Thrift Savings Plans (TSPs). The money you withdraw from those funds is considered taxable income.

The potential downside tax impacts of RMDs:

• They could potentially bump you into the next higher tax bracket
• They could increase your taxes on Social Security
• They could also increase your Medicare premiums due to IRMAA

Ways to help reduce the tax trap in retirement

How can you avoid paying unnecessary taxes in retirement? Here are a few strategies to consider.

1. Make Roth conversions (if appropriate).

A Roth IRA might be able to insulate you from future unknown taxes. Roth conversions are moving money from a pre-tax retirement account (such as a 401(k) or traditional IRA) into a Roth IRA.

You pay taxes on the amount you convert in the year you convert; the tradeoff is that you get tax-free growth and in retirement, withdrawals are tax-free. There's no limit on how much you can convert.

A Roth conversion is a popular strategy to help reduce future tax burdens, especially for those expecting higher tax brackets later or wanting tax-free inheritance for their beneficiaries. There are no RMDs for the original owner of the account.

Because Roth withdrawals are tax-free, using funds in your Roth account in retirement can help prevent you from a higher tax bracket.

2. Consider using the low tax window before your RMDs start.

Some people will experience a drop in income when they retire. A prime time to begin withdrawing or converting assets is when you're in a lower tax bracket.

Also consider that the next administration might increase taxes and make it more difficult from a yearly tax-rate perspective for some people to do such withdrawals or conversions.

Along with Roth conversions, here are other strategies to potentially take advantage of the low tax window:

• Consider early voluntary withdrawals. Start taking money out of IRA accounts after age of 59½ to lower the account balance and spread the tax liability over more years, rather than waiting for large, taxable RMDs.
• Balance tax brackets and IRMAA. Target a specific tax bracket in the years between retirement and RMDs to stay below higher tax brackets and avoid Medicare IRMAA surcharges.
• Consider qualified charitable distributions (QCDs). For those age 70½ and older, direct transfers from an IRA to a qualified charity can satisfy upcoming RMD requirements while reducing taxable income, even if you do not itemize deductions.
• "Fill" tax brackets. Purposefully take just enough income from tax-deferred accounts to reach the top of your current, lower tax bracket. You could end up paying less in taxes compared with the higher rates you might face when combined with future Social Security and RMDs.

3. Organize withdrawals by bucket.

In my experience, retirees often pull money from accounts in the wrong order, incurring tax consequences they could have otherwise avoided.

Taking too little from your tax-deferred accounts can lead to huge RMDs later in life. Taking too much early can increase your taxes and, potentially, your tax bracket.

It would be ideal to have a strategy that balances withdrawals from your taxable accounts, IRA (tax-deferred accounts) and Roth, while considering the income from Social Security and pensions.

The order in which you take withdrawals isn't a hard-and-fast rule. A sensible approach is to have three buckets of money:

• Taxable (brokerage accounts)
• Tax-deferred (IRA/401(k), etc.)
• Tax-free (Roth)

Deciding which bucket to withdraw from depends on what's going on in your life at that time.

Let's say you're married and filing jointly in the 12% tax bracket, which tops out at $100,800 of income for the 2026 tax year. Your taxable income for the year was close to that limit. You want to go on a cruise, and it's going to cost $5,000. Should you pull that amount from your tax-deferred bucket? No.

In this example, it may be better to pull it from your Roth because it's not taxable, and that $5,000 is not going to bump you into the next tax bracket.

Portfolio structure matters, especially in retirement.

• Consider placing tax-inefficient investments (e.g., taxable bonds, high-turnover funds) in tax-advantaged accounts, such as IRAs or 401(k)s
• Put tax-efficient investments (e.g., ETFs, index funds, municipal bonds) into taxable brokerage accounts
• Potentially avoid unnecessary capital gains, manage your dividends and distributions, and use tax-loss harvesting to offset capital gains and reduce tax burden

Review periodically and coordinate your plan

A retirement portfolio is not "set it and forget it." Too many things can change year to year, so make sure to review your plan periodically and adjust it as needed.

Keep these priorities in mind when reviewing:

• Income changes
• Market shifts that can affect your portfolio
• New tax laws that can affect your lifestyle, taxation and withdrawals
• Health care cost adjustments
• RMDs and Social Security

Retirement tax planning should be geared toward reducing taxes and avoiding ugly surprises, helping ensure you keep more of what you've worked hard to build and save.

If you're nearing retirement or already retired, it's important to ask yourself: Am I heading toward a possible tax trap in my retirement?

The earlier you spot the tax trap, the easier it may be to avoid and ensure you can retire relaxed and happy.

Dan Dunkin contributed to this article.

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

The One Big Beautiful Bill Act (OBBBA) opens up several planning opportunities that could make a real difference in what you keep in your pocket — not just this year, but for years to come.

If you're like our clients, whom we call Midwestern Millionaires — hardworking, frugal and diligent savers with $1 million or more saved (I wrote a book on this that you can request here) — these are five of the most important provisions to understand for how they may affect your long-term tax strategy.

1. Lower tax rates aren't going away (for now)

One of the biggest concerns we hear from clients is whether today's historically low tax rates are about to disappear. Current legislation signals that lower marginal tax rates are likely here to stay longer than previously expected, at least for now.

This creates a great window of opportunity for both retirees and pre-retirees to execute strategies such as:

• Roth conversions
• Accelerating income into lower-tax years
• Capital gains planning

If tax rates continue to remain relatively low, planning proactively and implementing various planning strategies now can dramatically reduce your lifetime tax liability.

This is especially important for those with significant IRA balances and/or pensions that will increase their income in the future.

2. A higher standard deduction — and bonus deductions

The standard deduction has already simplified filing for millions of Americans, and the OBBBA has increased the already large standard deduction once again.

For many households, this means that itemizing deductions will become even less common. But with the OBBBA comes an additional bonus deduction opportunity on top.

Specifically, the law introduces an enhanced deduction of $6,000 for taxpayers aged 65 and older. This additional deduction phases out at higher income levels, so it's most impactful for retirees and near retirees in moderate-income ranges.

This makes it more crucial than ever to revisit your tax strategy each year, rather than assuming your situation remains the same.

For those in or approaching retirement, the potential savings here are too significant to overlook.

3. A new charitable deduction for non-itemizers

Historically, if you did not itemize your deductions, you likely have seen no benefit from any charitable giving you have done over the years, but the OBBBA has changed that.

The law introduces a charitable deduction that's specifically designed for non-itemizers, so you can finally see a tax benefit for the giving you're already doing, even if you elect to take the standard deduction.

Those who file married filing jointly can deduct up to $2,000, and those who are single can deduct up to $1,000.

4. An expanded SALT deduction

The state and local tax (SALT) deduction cap has been a sticking point for years, particularly for higher-income households and those in high-tax states.

The OBBBA has increased the deduction cap, potentially allowing taxpayers to deduct more of their:

• State and local income taxes
• Property taxes

While the impact will vary depending on where you live, this could be a meaningful change for those who have felt limited by the previous cap of $10,000.

For some households, it may even make itemizing deductions viable again, especially when combined with mortgage interest, medical expenses and charitable deductions.

5. Trump Accounts for newborns

One of the more unique provisions in the bill is the introduction of so-called Trump Accounts, which are tax-advantaged savings accounts established for newborns.

These accounts are designed to create a financial head start for future generations.

While details will continue to evolve, the broader theme is clear: Early investing is being incentivized.

For parents and grandparents alike, this could be a great thing to do for their children/grandchildren. To find out more and to sign up your newborn, visit www.trumpaccounts.gov.

The bigger picture: Opportunity requires action

Tax legislation always creates winners and losers, but more importantly, it creates planning opportunities. The common thread across all five of these tax changes is flexibility:

• Lower rates extend planning windows
• Higher deductions simplify filing while adding targeted benefits
• Expanded deductions and new account types create new ways to reduce taxes over time

But none of these matters without a strategy. The households that benefit most won't be the ones who simply react — they'll be the ones who proactively adjust how and when they recognize income, take deductions and plan for the next generation.

Related Content

• 'We Have Food at Home': The 'Midwestern Millionaire' Mentality That's Built a Fortune
• Are You a 'Midwestern Millionaire'? 4 Retirement Strategies
• If You're the Millionaire Next Door, You May Be a Terrible Spender
• Do You Have at Least $1 Million in Tax-Deferred Investments?
• The Secret to Reducing Lifetime Taxes for Retirees in the 2% Club, From a Financial Planner

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Do you wonder how you can save on taxes while giving more to charity? As you reflect on your 2025 tax bill, it's an ideal time to consider your charitable, financial and tax planning for 2026.

To help start your planning, we'll answer three questions:

• What tax rules affect charitable giving in 2026?
• What are some charitable giving strategies that can be used to reduce taxes?
• Why is a donor-advised fund (DAF) a tax-smart way to give to charity?

You'll walk away with ideas on how to pay less in taxes and have more money to give to charity, whether you choose to itemize deductions or take the standard deduction for your 2026 taxes.

The tax rules that affect charitable giving in 2026

Two new rules for itemizers. Under the One Big Beautiful Bill Act (OBBBA), only aggregate charitable contributions that exceed 0.5% of your adjusted gross income (AGI) will be deductible.

If your AGI is $300,000, for example, you can deduct any contributions in excess of $1,500 ($300,000 times 0.5%).

Additionally, if you're in the 37% income tax bracket ($640,600 and higher for single filers or $768,700 and higher for married couples filing jointly), the OBBBA caps the value of your itemized deductions, including charitable deductions, at 35%.

Charitable deduction limits for itemizers. Overall deductions for contributions to public charities, including DAFs, are generally limited to 50% of your AGI. The limit increases to 60% of AGI for cash contributions. For appreciated non-cash assets held more than one year, the limit is 30% of AGI.

If your charitable deduction exceeds your AGI limit in 2026, you can carry the excess deduction amount forward in up to five additional tax years (while still staying within your AGI limit for each year).

Standard deduction amounts for non-itemizers. Itemizing makes sense if your total itemized deductions exceed the standard deduction. For 2026, the standard deduction amount is $16,100 for single filers and $32,200 for married couples filing jointly.

If you'll take the standard deduction for your 2026 taxes, the OBBBA allows you to deduct an additional amount for your cash contributions to qualified operating charities: up to $1,000 if you're a single filer or $2,000 if you're a joint filer.

Note that a DAF is not an operating charity, so the charitable deduction can't be used for DAF contributions. (Read more about tax law changes.)

Charitable-giving strategies that can reduce taxes

Potentially eliminate capital gains taxes by donating appreciated non-cash assets. You can have stock shares, real estate, crypto or another non-cash asset that has gained a lot of value relative to your original cost.

While you could sell the asset and give cash to charity after the sale, donating an appreciated non-cash asset held for more than one year is tax-smart and can unlock additional funds for charity in two ways:

• First, you potentially eliminate the 15% or 20% capital gains tax you would incur if you sold the assets and donated the proceeds, which may increase the amount available for charity by up to 20%
• Second, you could potentially claim a fair market value charitable deduction for the tax year in which you make the gift, assuming you itemize (donation deduction is subject to certain AGI limitations)

Offset unexpected income with a charitable contribution and deduction. You may have a financial windfall in 2026 — a large bonus at work, conversion of a traditional IRA to a Roth IRA or equity-compensation awards. This income is taxable and could push you into a higher-rate tax bracket.

One way to reduce your taxable income is to donate to charity and claim a deduction, if you itemize, in an amount that entirely or partially offsets the additional income.

Bunch charitable contributions to maximize deductions. You may find that your total itemized deductions for 2026 are below your standard deduction amount. If you frequently give to charity, you may wish to explore a bunching strategy:

• Consolidating two years of charitable contributions (2026 and 2027) into this year to exceed your standard deduction amount
• Itemizing deductions for 2026 taxes
• Taking the standard deduction for 2027

This strategy maximizes both itemized and standard deductions and can result in larger tax savings than two years of standard deductions.

In addition, if you itemize deductions for 2026, bunching your 2026 and 2027 charitable contributions into 2026 could help you exceed the 0.5% of AGI deduction floor cited in the tax rules section above.

Why is a donor-advised fund (DAF) a tax-smart way to give to charity?

A DAF is a charitable-giving vehicle offered by a 501(c)(3) public charity. It can be used with many of the tax strategies above and provides these tax benefits:

• You contribute cash, securities or other appreciated assets to a DAF account and could be eligible for a current-year tax deduction if you itemize
• If your contribution consists of appreciated non-cash assets held more than a year, your deduction generally is the fair market value of the assets (subject to certain AGI limitations), and you can potentially eliminate capital gains taxes on the appreciation
• You may recommend how contributed assets are invested for potential growth that's tax-free, with the goal of having more money available for grants to charity

Once assets are contributed, you can use the assets for recommending grants to the charities of your choice immediately or over time.

What you can do next:

• Talk with your financial and tax advisers
• Open a DAF account
• Use the strategies above to contribute to your DAF account

Related Content

• 3 Major Changes to the 2026 Charitable Deduction
• How the One Big Beautiful Bill Will Change Charitable Giving
• A Financial Planner Takes a Deep Dive Into How Charitable Trusts Benefit You and Your Favorite Charities
• One Big Beautiful Bill, One Big Question: Will We Keep Giving?
• How to Donate Your Life Insurance Policy to Charity

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

When the One Big Beautiful Bill Act was signed into law last summer, it introduced tax changes poised to impact the charitable giving landscape. In response, many donors and their advisers acted fast to adjust their tax planning.

Now, investors and donors should look ahead and determine the strategies needed to achieve tax management and charitable giving goals this year and beyond.

For donors itemizing deductions, the biggest changes affecting charitable giving involve both ends of deduction limits. The law created a new floor on charitable deductions, wherein only gifts exceeding 0.5% of adjusted gross income can be deducted.

On the other side of the spectrum, the value of deductions for individuals in the top tax bracket (37%) is now capped at $0.35 per dollar, a decrease from the former $0.37 per dollar limit.

Additionally, corporations can only deduct charitable contributions if they exceed 1% of taxable income, with a cap set at 10%.

Many Vanguard Charitable donors have said that getting ahead of these changes, along with continued strong equity market returns, were key drivers in the uptick in year-end giving last year.

As donors navigate 2026, maximizing tax deductions and charitable impact within these new limits will require careful preparation. Working closely with a tax adviser or accountant is essential to build a strategy that navigates this new deduction floor while achieving the best outcomes for the charities you support.

Steps to consider this year

To maximize the tax benefits of charitable giving during high-income years, donors with significantly appreciated assets may consider bunching multiple years of contributions into the current year.

When deciding which appreciated assets to contribute, consider any complex assets you may own, including real estate and interests in private companies or partnerships.

Finding the right giving tool

Periods of legislative change present an ideal opportunity for you to review your financial plans, ensuring you still realize maximum tax efficiency and continue to grow your philanthropic footprint.

A donor-advised fund (DAF) can be a powerful tool that helps maintain charitable momentum, even in years where you must reevaluate or adjust your giving strategy. DAFs offer a critical advantage that empowers this type of flexibility: They separate the contribution of an asset from the grant to a nonprofit organization.

DAFs allow you to make an immediate, tax-deductible contribution — whether in cash, appreciated securities or complex assets — that strategically aligns with your broader tax and portfolio objectives.

Once contributed, these assets are invested according to a strategy that you and the DAF sponsor select, offering the potential for tax-free growth over time. Ultimately, this structure provides you with the flexibility to recommend grants to qualified charities on your own timeline, maximizing your philanthropic footprint.

Philanthropic need rarely aligns with evolving tax laws or market fluctuations. Charitable causes rely on predictable sources of funding year-round, regardless of market performance, and they often require immediate support in direct response to emergency needs.

A DAF allows you to tailor your giving strategy to respond to new tax rules and portfolio performance while continuing to grant to your favorite causes. If you feel a deep conviction to consistently support the causes you champion, the built-in adaptability of a DAF can be a giving gamechanger.

Separating tax strategies and philanthropic strategies

A DAF enables you to take an intentional approach in all aspects of giving. You can prioritize gifting assets that are right for the scope of your portfolio in light of tax law and market shifts. While funds remain in the account, they can be invested according to your preferences and risk tolerance to help you reach your charitable goals.

You can also grant funds in alignment with your philanthropic priorities. This peace of mind allows you to focus your time and energy on the most impactful parts of your philanthropic strategy.

Typically, making regular updates to investment strategies is not the best approach — this is especially true for DAF holders. The investment strategy for assets within a DAF is built to withstand market volatility and uncertainty.

Therefore, resisting the urge to make drastic changes or chart a new course in response to market fluctuations or other external factors is often the best tactic. Letting low fees and an established plan do the heavy lifting of growing assets to increase charitable impact is generally the best path forward.

However, there can be value in revisiting grantmaking priorities on a regular basis. Adjusting grantmaking strategies based on emergency needs, shifting societal forces and family priorities can be rewarding for you and your chosen causes.

Funding models such as recurring and recoverable grants can help amplify efforts and achieve charitable goals. Revisiting these priorities often can yield greater philanthropic impact and provide greater meaning and value in any specific year and over the long term.

Meet change with confidence

Ultimately, while shifting tax landscapes and market dynamics may necessitate a fresh look at how and when you contribute to your charitable vehicles, the core of your philanthropic mission remains unchanged. By leveraging flexible tools, such as a donor-advised fund, you can seamlessly navigate legislative complexities without compromising your support for the causes that matter most.

As you plan for the year ahead, consider partnering with your financial adviser to ensure your giving strategy is as tax efficient as it is impactful, allowing your charitable legacy to thrive regardless of the changing rules around it.

Related Content

• For More Flexible Giving, Consider Combining a Charitable Remainder Trust With a Donor-Advised Fund
• How to Maximize Your Impact With Strategic Philanthropy Tools
• A Financial Planner Takes a Deep Dive Into How Charitable Trusts Benefit You and Your Favorite Charities
• Five Ways to Maintain Charitable Giving During Volatile Times: A Giver's Guide
• DAFs vs. Private Foundations: Which Giving Strategy Is Right for You?

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Question: We're 71, retired, and have an $8,000 monthly income. I want to travel to Europe while we still can, but my wife believes tithing (or donating 10% to our church) is her religious duty. I think she shouldn't feel so pressured to give. We're comfortable but not wealthy. What's a tax-efficient and relationship-saving solution to this issue?

Answer: Religion is a very personal matter. And it's not uncommon for people who share the same faith to practice it very differently. But no matter which religion you identify with, the obligation to tithe in some shape or form may be a core part of your beliefs.

In 2023, Lifeway Research found that 77% of American Protestant churchgoers believe tithing is a biblical command that still applies today. Only 10% say it's not.

It's not just Christianity that promotes tithing; many religions, such as Judaism and Islam, also have a practice of donating a portion of one's income.

If you believe in tithing, you may want to uphold that practice even once you retire and move onto a fixed income. And if you have a retirement income of $8,000 a month, you may be comfortable enough that you can swing it. Still, it's important to make sure you don't upend your finances in the process and cause yourself undue stress.

Make sure you're giving in the most tax-efficient manner possible

Donating 10% of your retirement income is extremely generous. But if your monthly income is only $8,000, you may not exactly have a lot of extra money to spare. So it's important to snag whatever tax breaks you can in the course of that giving. (Keep in mind that there are new charitable tax deduction rules in 2026.)

Chad Gammon, CFP and owner of Custom Fit Financial, says that if you're going to tithe and have a traditional IRA, it pays to donate directly from that account. As long as you're at least 70½, Gammon says, you can make your annual donations via qualified charitable distributions (QCDs).

"The IRA custodian who holds the account would send the money directly to the religious organization," Gammon explains. "The distribution would be excluded from your income and the religious organization would not pay tax either."

As long as the organization you're donating to is a qualified charity, QCDs are the most efficient way to tithe, Gammon insists. He also recommends looking into setting up a donor-advised fund (DAF), as that may be a tax-efficient way to give, too, depending on the assets you wish to donate.

"Your religious organization probably has some knowledge of QCDs and DAFs," Gammon says. "They can be very helpful knowing your intent."

You may want to calculate your tithe a different way

Traditionally, tithing has meant donating 10% of one's income to charity. But Cody Garrett, CFP, owner and financial planner at Measure Twice Financial, says you may want to use a different formula as a retiree.

"An alternative approach to tithing in retirement is to give a percentage of your net worth rather than a percentage of your income," he explains. "For example, a worker earning $100,000 might give 10% of their gross income, and a retiree may give 1% of their $1,000,000 net worth annually."

In this example, both formulas result in the same amount of $10,000. However, the annual income you draw in retirement may fluctuate from year to year, depending on your needs, the performance of your investments and other factors. So you may feel more comfortable calculating your annual donations as a percentage of your net worth.

Remember that flexibility is important

Retirement can be a financially precarious period of life. And your income may not be nearly as predictable as it was when you were working.

You may have $8,000 a month coming your way now. But if half of that is Social Security and the other half comes from your savings, it means you could have some years when your income is nowhere near $8,000 a month.

Say the market takes a dive and your portfolio loses value. If it's a bad time to tap your savings, you may suddenly be limited to $6,500 a month instead of $8,000.

Now it may be that you were able to afford an $800 monthly donation when you had $8,000 coming your way, as that left you with $7,200 for remaining expenses. If you're now limited to $6,500 due to a market downturn, you may not have the room in your budget to part with 10% of your income.

That's why Garrett says you may want to take a more flexible approach to tithing.

"Some tithers follow strict Old Testament interpretations and believe the tithe should be calculated on gross income, before taxes or deductions," he says. "Others frame it as giving voluntarily from the heart."

As Garrett points out, 2 Corinthians 9:7 says, "Each of you should give what you have decided in your heart to give, not reluctantly or under compulsion, for God loves a cheerful giver."

In other words, tithing is a wonderful thing to do, but it shouldn't cause you undue stress. If there's a period during retirement when you can't afford to give 10% of your income, give whatever amount is meaningful without compromising your ability to cover your basic needs. You can always increase your donations during years of higher income if you feel compelled to compensate.

Read More

• We Retired at 62 With $6.1 Million. My Wife Wants to Make Large Donations, but I Want to Travel and Buy a Lake House.
• 4 Smart Ways Retirees Can Give More to Charity, From a Financial Adviser
• How to Give to Charity and Also Generate Retirement Income

IRS tax season is upon us, but if the first time you turn your attention toward taxes every year is when you're gathering documents to file, the chances are you're missing out on some loopholes that can help lower your tax obligation.

These tips can help you (legally) reduce what you owe every year.

1. Supercharge your retirement savings with the mega backdoor Roth

Roth IRAs have both income and contribution limits set by the IRS, making direct contributions to Roth IRAs generally unavailable to some high earners.

One workaround for those high earners is the mega backdoor Roth strategy in which after-tax contributions are made to a 401(k) and then converted to a Roth 401(k) or Roth IRA.

Only employer plans allowing after-tax contributions are eligible for this strategy. This option might be worth exploring with your financial adviser if your income is too high to contribute to a Roth IRA, allowing you to increase the tax-free savings in your retirement accounts.

2. Turn your HSA into a stealth retirement account

Health savings accounts (HSAs) are designed as tax-advantaged accounts to hold funds for medical expenses, but a loophole allows you to stealthily use your HSA as a retirement account of sorts.

Since HSA funds don't expire every year, the funds can continue to grow tax-free. And since contributions to HSA accounts can be tax deductible, your annual taxable income can be reduced by your HSA contributions.

Withdrawals aren't taxed as income as long as the funds are used for medical expenses (those age 65 or older can use the funds for non-medical expenses without penalty but with the funds taxed as ordinary income).

HSAs don't have required minimum distributions, making them incredibly flexible in retirement.

Of course, HSAs can also be valuable as a way for those with high-deductible health insurance plans to pay their medical expenses, but when used as a stealth retirement account by those who qualify for these accounts, HSAs can nicely augment additional retirement funds.

3. The charitable 'bunching' strategy that doubles your deduction

Your generosity to the causes you care about can help lower your tax obligation, but if you're taking the standard deduction every year, there's a chance you're missing out on the opportunity to maximize your deductions.

A donor-advised fund (DAF) allows you to contribute assets (such as cash, stock and real estate) to an established, managed fund. Since the donation goes into the fund, there is some flexibility as to when you can take the deduction.

Even if the assets aren't allocated to a charity immediately, you can still take the deduction right away.

Since DAFs allow flexibility in what you can contribute, the potential for lowering capital gains tax by donating appreciated assets shouldn't be ignored.

Donating appreciated stocks directly into a DAF (instead of selling the stock and donating the proceeds) maximizes your impact while potentially lowering the tax you owe.

4. Family payroll power: Pay your kids and cut your taxes

Hiring your children to work for your business can make a lot of sense from the perspective of positioning them to live productive lives (or perhaps even someday become your successors), but it also makes sense when it comes to reducing your tax obligation.

The wages you pay your children for their work can be deductible as a business expense and, depending on their age and income, might not be taxable to them.

The trick here is that your children must actually work for you (you can't just add them to the payroll), the pay must be appropriate for their role, and you must keep records of their employment just as you would with any other employee.

Consider maximizing the benefits by having your children contribute to a Roth IRA with their wages, making the arrangement a win/win for you and them.

5. Harvest losses to offset gains (even in good years)

Contrary to what you might have heard, tax-loss harvesting isn't just for down markets. Instead, it's a potentially effective way to reduce what you owe in taxes while also balancing your portfolio.

Losses can offset capital gains, then up to a $3,000 loss can be claimed on your taxes against your ordinary income annually. Any remaining loss can be carried over into subsequent years.

You're not allowed to turn around and repurchase the stocks you sold at a loss (or stocks that are "substantially identical") within 30 days of the sale if you're claiming the loss.

But tax-loss harvesting is one of the simplest legal tools to fine-tune your taxable income and keep your portfolio efficient.

Like any of the other loopholes mentioned above, tax-loss harvesting is a strategy that should be discussed with your financial adviser to ensure it's something for which you qualify and that it's done correctly with proper documentation throughout the process.

Any strategy that reduces your tax bill can theoretically invite additional scrutiny from the IRS.

These strategies are legal methods for reducing your tax bill — they're not covert schemes that will automatically raise red flags and trigger an audit. Use these loopholes correctly and you may just reduce the amount of money you owe to the IRS.

I often speak with the families I serve about seeking joy. What brings about joy during tax season? A lower tax bill, of course.

This article represents the opinion of Mitlin Financial Inc. It should not be construed as providing investment, legal, and/or tax advice. Investment advisory services offered through CWM, LLC, an SEC Registered Investment Advisor. Mitlin Financial is located at 140 Adams Avenue Ste. B-12 Hauppauge, NY 11788

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Not long ago, I was working with a family who had an eye on giving back to the community and the world. They wondered whether they were doing so in the most efficient way possible and whether there were better options.

The family matriarch had set up a charitable remainder trust that designated two specific organizations to receive the money upon her death.

The family members questioned whether this was the best approach. What if one or both of the organizations no longer existed when she passed away? What if one of the organizations changed its mission so that it no longer matched the family's beliefs or leanings?

Would they want this money to go to a charity that may have strayed from its original purpose?

As we talked about their concerns, I suggested they think about establishing a donor-advised fund (DAF), a tool that could alleviate their apprehensions while giving them more control over when, how and to whom they make their donations.

An additional advantage was that a DAF could be made a beneficiary of the existing charitable remainder trust (CRT). That way, the fund would provide added flexibility while the family's trust stayed in place.

The family members were unfamiliar with DAFs, as you may also be. But for those who want to donate to their favorite causes while maintaining some control over how the money is handed out, this type of fund can make a lot of sense.

Spreading out donations

Here's how DAFs work: You establish an account in the name of one or more donors, and that account is held in custody by a nonprofit organization, which is considered the sponsoring organization.

You then make tax-deductible contributions to the account. Even though you can claim a contribution as a charitable tax deduction when you contribute to the account, you don't have to distribute the money to a charity all at once.

The money can grow tax-free for years, and you can make multiple donations over time and even spread the money out among several charities.

In other words, you can contribute to the fund whenever you like. You can also distribute money to causes when needed or when it simply makes the most sense.

That way, if a particular charity dissolves or its mission evolves — which were among the concerns of the family I was working with — you can adapt your giving plans as needed.

DAFs have grown in popularity. In 2023, the funds made a total of $54.8 billion in grants to charities, according to the National Philanthropic Trust's 2024 DAF Report. Although that figure was slightly down from 2022, it was nearly double the amount awarded as recently as 2019, when $28.5 billion in grants were distributed.

How much can and should you contribute to establish a DAF?

That varies quite a bit depending on the sponsoring organization. Some organizations require no minimum amount at all, while others require at least $10,000, $25,000 or more.

A long-lasting legacy

The family I was working with appreciated the opportunity to make grants to charities on a more flexible basis. If, as time passed, other organizations they liked came to their attention, they could simply direct grants to those groups.

By making a DAF a beneficiary of their charitable trust, they could help more causes, have a longer-lasting legacy and allow more family members to participate in the giving.

If you're interested in creating a legacy through charitable giving, consider a DAF to achieve your goals. And if you already have a CRT in place, think about adding a DAF as a beneficiary.

A financial professional can help you understand how this and other charitable-giving options work, so you land on an approach that works best for you.

Leaving a legacy through philanthropy is rewarding for everyone involved.

Ronnie Blair contributed to this article.

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As retirement gets closer, most planning conversations stay comfortably focused on income and investments.

What often gets delayed — or avoided entirely — are the more important elements of retirement planning: Estate planning, philanthropy and protecting assets against long-term care and health events.

The reason is simple. These topics force more difficult conversations. They touch on health, dependency and mortality — subjects most people would rather postpone talking about. But framing this planning as "end-of-life" thinking misses the point entirely.

This isn't about preparing for the end. It's about protecting what you've built and preserving your ability to live the life you want — for as long as possible.

When these issues aren't addressed early, they tend to be dealt with later under pressure, often during a health event or family crisis. At that point, decisions are reactive instead of intentional, and the cost — financial and emotional — is usually much higher.

This is about more than documents

Estate planning, at its core, is not about documents. It's about control. It's about helping to ensure that your assets are managed and transferred according to your wishes, not default rules. It's about reducing friction for the people you care about and preventing wealth from being lost to inefficiency or confusion.

Philanthropy fits into this same conversation. For many retirees, giving isn't an afterthought — it's an expression of values. Thoughtful charitable planning allows you to support causes you care about in a way that aligns with your overall financial strategy, rather than competing with it.

Then there's asset protection, particularly around long-term care. This is one of the most misunderstood and avoided areas of retirement planning. The reality is that extended care is not a remote possibility — it's a planning variable. Ignoring it doesn't eliminate the risk; it simply transfers it to your portfolio, your spouse or your family.

When protection planning is done well, it doesn't restrict lifestyle — it helps preserve it. It creates flexibility. It helps safeguard income. And it helps ensure that a lifetime of disciplined saving isn't quietly eroded by one unplanned event.

Thoughtful retirement planning is not about pessimism. It's about intention. It's the difference between hoping things work out and designing a strategy that supports your health, your independence, your legacy and your ability to enjoy retirement on your terms.

This is the stage where planning moves beyond accumulation and income — and becomes about stewardship.

Turning unspoken legacy goals into intentional strategy

Most people carry clear legacy goals in their minds, but those goals are rarely on paper or included in conversations. These people know what matters to them. They know who they want to protect. They often have a strong sense of who should carry forward their values, traditions or resources. What's missing isn't intention — it's articulation.

This is where professional planning begins to work. When legacy goals are finally named and communicated, planning shifts from transactional to intentional. The conversation expands beyond "who gets what" to "who should be supported, empowered or protected" — and why.

These discussions frequently reveal priorities that were never reflected in the financial plan. A surviving spouse's security. A child who may need more guidance or protection. Grandchildren, charitable causes or family members who share a common set of values. Legacy planning isn't about equal distribution — it's about aligned distribution.

Once these goals are clear, something important happens: The financial strategy can finally be coordinated around them.

Tax planning, in particular, becomes more purposeful. When assets are viewed through a legacy lens, it often makes sense to reconsider how tax-deferred accounts will eventually be taxed — and by whom.

In many cases, this opens the door to intentionally converting portions of tax-deferred assets into tax-free assets over time, with minimal tax impact, because the strategy is coordinated rather than reactive.

This isn't about avoiding taxes at all costs. It's about paying them on your terms, at the right time and for the right reason — in service of preserving what you're trying to pass on.

Preserving independence, choice and control

The same principle applies to long-term care planning. Too often, the conversation gets stuck on expensive, stand-alone insurance policies that feel disconnected from the rest of the plan. But protecting assets from health care-related erosion doesn't have to be separate from growth or legacy planning.

When approached intentionally, solutions for long-term care can be integrated into the allocation engine itself — supporting growth while also helping provide protection. The goal isn't to plan for decline; it's to preserve independence, choice and control without sacrificing opportunity.

When legacy, taxes, growth and protection are designed together, trade-offs become clearer, and outcomes become more predictable. This is what transforms a collection of accounts into a coordinated system — one that reflects your values, protects the people you care about and supports a life well lived.

This level of planning doesn't happen by accident. It happens when conversations move from what's comfortable to what's meaningful — and when strategy is built around intention rather than default outcomes.

Creating the outline of an intentional retirement plan

Once legacy, protection and tax awareness are part of the conversation, the next step is not to jump to solutions — it's to create a clear outline of what the plan is actually meant to do. Before strategies are selected, because structure matters.

Step No. 1: Clarify who and what you care about.

Every well-designed plan starts with people and values, not products.

• Who do you want to protect?
• Who do you want to support?
• Who do you trust to carry forward what's important to you?

This includes family, but it often extends beyond it. Many people care deeply about causes, organizations or missions they've supported quietly for years. Others want certain values — responsibility, generosity, independence, education — to be felt by the next generation, not just funded.

These priorities are often clear internally but unspoken. Writing them down and communicating them creates alignment. It also determines how assets should be positioned, distributed and protected. Legacy planning is not about perfection — it's about intention and trust.

Step No. 2: Understand where you're exposed to future taxes.

With legacy goals defined, the next step is understanding how your assets will actually be taxed over time.

• How much of your wealth is sitting in tax-deferred accounts that will be subject to future tax increases and required minimum distributions?
• How much is already tax-free?
• How much sits in after-tax or taxable accounts?

This segmentation matters. Not all dollars are created equal. Each "bucket" behaves differently, is taxed differently and should be assigned a different role in the plan.

When assets aren't clearly segmented, tax planning becomes reactive. When they are, tax mitigation becomes intentional.

This is often where opportunities emerge — particularly when tax-deferred assets can be repositioned or converted in a coordinated way, over time, with minimal tax impact.

The goal isn't to eliminate taxes. It's to manage when, how and at what rate they're paid in support of income, protection and legacy.

Step No. 3: Assign roles to each asset.

Once assets are segmented, the plan begins to take shape.

• Some assets are best suited for income
• Some for growth
• Some for tax efficiency
• Some for legacy transfer
• Some for protection

Trying to make every account do everything usually leads to inefficiency. When assets are intentionally designated for specific roles, the entire system becomes more durable and easier to manage. This is where coordination replaces complexity.

Step No. 4: Design the long-term care "faucet."

Long-term care planning is not theoretical. In my experience, clients who have cared for parents, siblings or spouses — or who are navigating care themselves — understand this immediately.

When a health event occurs, income needs don't increase by hundreds of dollars per month. They often increase by thousands.

In many cases, the cost of care can exceed $100,000 annually. This isn't an edge case — it's a reality for a significant portion of retirees.

The real question isn't if care will be needed. Statistically, most people will require some level of support. The real question is where will the money come from — and who bears the burden?

• How much pressure do you want to place on a spouse?
• How much responsibility do you want to place on your children?

A well-designed plan identifies an intentional "faucet" — a source of funding that can be turned on when a health event occurs, without dismantling the rest of the plan. This may involve insurance, asset repositioning or integrated solutions that support growth while also providing protection.

What matters most is that the decision is made in advance, not during a crisis.

When these steps are taken together — values clarified, assets segmented, taxes coordinated and protection designed — retirement planning stops being a collection of accounts and becomes a system. One built to support independence, protect relationships and preserve the life you've worked hard to create.

Before making changes to investments and making important decisions about long-term care or tax strategy, it's critical to understand whether your current retirement plan is aligned with what comes next. The WealthSync™ Process, built from decades of experience, helps business owners and high-achieving families navigate this transition with intention. The 7-Minute WealthSync™ Diagnostic uncovers hidden inefficiencies, silent tax leaks and gaps between your income needs and your vision for retirement. In just a few minutes, it provides clarity around how well your income, taxes and investments are working together — and where misalignment may exist. Complete your diagnostics here.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As 2026 gets underway, individuals and qualifying businesses should be reassessing several tax adjustments already in motion, and refining strategies to ensure they’re positioned as efficiently as possible for the years ahead.

Advisers know there’s rarely a “quiet” moment when it comes to tax planning, but the transition into 2026 is proving especially consequential.

With key provisions of the One Big Beautiful Bill Act (OBBBA) now effective and others phasing in, advisers should be helping clients recalibrate their tax strategies in light of a meaningfully altered landscape.

1. Itemized deductions

One of the most impactful changes involves itemized deductions, particularly for high-net-worth and ultra-high-net-worth taxpayers.

Under the OBBBA, itemized deductions are now capped at a tax benefit of 35 cents per dollar for those in the top tax bracket, down from as much as 37 cents previously.

While the difference may seem modest, it can materially affect the after-tax value of deductions at higher income levels.

For many taxpayers, this underscores the importance of timing. Advisers should be reviewing whether clients appropriately accelerated and “bunched” deductions ahead of the change and, if not, how to best optimize deductions going forward under the new limitations.

2. Charitable giving

Charitable giving has also entered a new phase. As of 2026, taxpayers can only realize a tax benefit for charitable contributions to the extent they exceed 0.05% of adjusted gross income (AGI).

While this threshold applies universally, the impact is naturally magnified for higher earners. Compounding the effect, the itemized deduction cap further reduces the ultimate tax value of charitable gifts.

These changes reinforce the continued relevance of donor-advised funds (DAFs). For clients who established DAFs before the end of 2025, the ability to front-load contributions preserved deductions under more favorable rules.

Going forward, DAFs remain a powerful planning tool, allowing investors to support charitable causes on a flexible timeline while enabling assets to grow tax-efficiently before distribution.

3. Renewable energy and solar tax credits

Another area where timing proved critical, and where advisers should confirm execution, is renewable energy and solar tax credits. Many of these incentives ended at the end of 2025 under the OBBBA.

Clients who completed qualifying energy-efficient projects before year-end may now be realizing meaningful tax savings, while those who delayed may find those opportunities closed.

Reviewing eligibility and documentation is an important step early in the 2026 tax cycle.

4. Qualified small business stock

Beyond individual taxpayers, the OBBBA introduced several notable changes for entrepreneurs and business owners, particularly around qualified small business stock (QSBS).

The enhanced $15 million exclusion is now paired with shorter holding periods, allowing for a 50% exclusion after three years, 75% after four years and full exclusion at five years.

This revised structure makes C-corporation formation more attractive for certain founders, especially in fast-growth sectors where liquidity events may occur on an accelerated timeline.

For private equity-backed businesses and early-stage companies eyeing strategic exits, QSBS planning is becoming an increasingly central part of entity-structure discussions.

5. Opportunity zones

Opportunity zones are another area gaining renewed attention as 2026 unfolds. While existing designations sunset at the end of the year, new opportunity zones will take effect beginning January 1, 2027, and the program itself has been made permanent.

For investors anticipating significant capital gains, this creates a rolling planning opportunity.

By reinvesting eligible gains into a qualified opportunity fund (QOF) within 180 days, investors can defer taxes for up to five years.

More importantly, gains on investments held in a QOF for at least 10 years remain permanently excluded from federal capital gains taxes — an especially compelling benefit for long-term investors.

Proactive planning and open communication

Whether the focus is on adjustments already in effect or longer-term strategies that extend well beyond 2026, one theme remains constant: Proactive planning matters.

The most effective tax strategies are the product of ongoing dialogue between advisers and clients, not last-minute decisions made under pressure.

As the OBBBA reshapes key areas of the tax code, staying engaged, revisiting assumptions and implementing thoughtful mitigation strategies can make a meaningful difference.

In an environment defined by complexity and change, maintaining open lines of communication may be one of the most valuable planning tools advisers can offer.

Related Content

• What Changed on January 1: Check Out These Opportunities Created by the New Tax Law
• Are Roth Conversions for Retirees Dead in 2026 Because of the New Tax Law?
• How Will the One Big Beautiful Bill Shape Your Legacy?
• How the One Big Beautiful Bill Will Change Charitable Giving
• 2026 Marks a Seismic Shift in Tax Rules, and Investors Could Reap Millions in Rewards

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

While the One Big Beautiful Bill Act (OBBBA) has been widely covered, the headline changes do not create many meaningful planning opportunities.

The primary goal of the OBBBA was to make permanent certain provisions that were scheduled to expire in 2026.

However, a more analytical read reveals a limited number of changes to explore as the year kicks off that do present some opportunities.

Charitable deductions now have a 0.5% adjusted gross income (AGI) haircut

Prior to 2026, taxpayers received the full benefit of charitable donations made. Not only is there a haircut now, but the size of the haircut is directly tied to a taxpayer's AGI for the year.

As a result, the timing of charitable deductions becomes more important than ever — and in a way that is somewhat counterintuitive. Historically, it was always beneficial to make increased charitable contributions in big-income years to ensure maximum tax benefit.

Under the new rules, however, higher-income years produce a larger 0.5% AGI haircut, which can make it more tax-efficient to concentrate charitable deductions in lower-income years.

That said, the analysis is not linear, as deductions taken in years where income is too low may still generate a lower overall tax benefit than deductions taken in higher-income years.

It may also be advantageous to bunch charitable contributions because once the 0.5% AGI haircut is exceeded, each incremental charitable dollar will be free of the haircut.

With all of these variables on timing, it becomes increasingly important to use a charitable giving vehicle that allows taxpayers to separate the timing of deductions from the timing of distributions to charity.

The best charitable vehicles for this are private foundations and donor-advised funds (DAFs). DAFs are often the simplest option, as they are administered by large brokerage firms that handle the administration burden — allowing donors to focus solely on what charities to donate to and when.

Best practice would be to maintain a fully funded DAF that could be used for ongoing charitable giving, while funding the DAF only periodically, working with your tax adviser to identify the best year to do so.

State and local tax (SALT) deductions did not return

The Tax Cuts and Jobs Act of 2017 made a significant change in the deductibility of SALT by capping the amount that could be deducted to only $10,000.

This change was supposed to be relatively temporary, with the cap scheduled to expire in 2026, when SALT was set to be fully deductible again.

OBBBA made the cap permanent, though some relief was provided with the increase of the cap from $10,000 to $40,000. For high-income earners, this relief hardly makes an impact.

However, a few state-tax mitigation strategies have emerged over the years, but with the SALT cap meant to be temporary, these strategies received limited attention. Now that the cap is permanent, these strategies should be freshly considered.

The first, and more powerful, strategy to consider is the use of out-of-state non-grantor trusts. If a trust is created in a no-tax jurisdiction, such as South Dakota or Nevada, and income-producing assets are transferred to the trust, then state tax can be completely avoided on that income, effectively neutralizing the SALT cap on that income.

This strategy is not always available to all types of income, especially earned income; plus, having assets in a trust does create some barriers between you and your wealth.

In instances where an out-of-state non-grantor trust isn't an option, the next best strategy to consider is utilizing a pass-through entity to make an election to pay state taxes at the entity level.

Although pass-through structures are typically designed to avoid entity-level taxation, many high-tax states now offer elections that allow state taxes to be paid at the entity level with a corresponding credit, effectively restoring full deductibility of those taxes.

Each of these strategies introduces additional complexities, but for high-income earners in states with high tax rates, these complications could result in significant tax savings, making them worth consideration.

The estate tax exemption was not cut in half, as it was set to do on January 1, 2026

Instead, it rose to $15 million per person, which is an increase of more than $1 million from 2025 levels — these amounts are doubled for married taxpayers.

The federal estate tax itself was unchanged and remains at a steep 40%. As a result, estate planning is more important than ever for taxpayers whose estates exceed the exemption amount.

The above changes are likely to have the greatest impacts, but there are several other provisions that may be significant for affected taxpayers.

For example:

• For taxpayers in the highest 37% tax bracket, all of their itemized deductions are capped at 35%, watering down the benefit of their itemized deductions. This may shift the focus toward tax-aware investing strategies designed to reduce taxable income, mitigating the impact of the deduction cap.
• For entrepreneurs and investors in early-stage companies, the qualified small business stock (QSBS) tax benefits have increased, allowing a higher capital gain exclusion of $15 million, vs $10 million, as well as allowing larger businesses to qualify, including businesses valued at up to $75 million, vs $50 million.
• For business owners, full 100% bonus depreciation is back, allowing a full write-off for tangible assets used in a business that have a life of less than 20 years.
• For real estate investors, qualified opportunity zone (QOZ) benefits are currently in a gap year. Gains deferred in the initial QOZ regime will be taxable as of December 31, 2026. While new gain deferral is not available this year, a revised QOZ regime is scheduled to begin in 2027, featuring new rolling five-year deferral periods with no stated expiration date.

While headline changes from the OBBBA do not create extensive planning opportunities, taxpayers with a detailed understanding of their tax profile, and the OBBBA, may still find opportunities in 2026 and beyond that could have a meaningful impact and are worth the consideration and review.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

The charitable giving landscape is set for its most significant tax overhaul in a decade. Starting this year, new federal tax rules — enacted via the big GOP/Trump tax and spending bill — change how nearly every American taxpayer can deduct contributions on federal returns.

For instance, a new tax break allows those who claim the 2026 standard deduction to deduct charitable giving donations. At the same time, new rules limit how the itemized charitable deduction reduces taxes for high earners.

Here are three big ways the charitable deduction has changed for individual taxpayers in 2026, and what these new rules might mean for you.

Note: This article pertains to federal income taxes only. State income returns may differ.

1. New $1,000 standard deduction charity break in 2026

Do you typically claim the standard deduction on your federal taxes? You're in luck. Beginning in tax year 2026, there's a new deduction you could take.

The non-itemizer charitable deduction is available for all taxpayers claiming the standard deduction, worth up to $1,000 ($2,000 for joint filers).

Here are a few fast facts on this key tax break:

• Only cash contributions qualify (checks, credit card charges, online donations and payroll deductions).
• The donation must be made to a qualified 501(c)(3) public charity.
• You must follow the typical IRS rules for a charitable deduction, including obtaining a written acknowledgement if you donate $250 or more.

Unlike the itemized charitable deduction, any contributions exceeding the annual limit for the non-itemized deduction cannot be carried forward. You also can’t use the deduction in conjunction with a donor-advised fund (DAF) or private foundation, as you can for itemized charitable contributions.

Despite these limitations, some predict that 144 million Americans will be eligible to claim the standard deduction charitable tax break during the 2027 filing season.

A similar (though temporary) policy took place during the COVID-19 pandemic, which allowed a $300 charity deduction for individual non-itemizers. Almost 30% of standard deduction filers took advantage of the tax break, "indicating that the One Big Beautiful Bill (OBBB) even larger deduction could be popular," per the Tax Foundation.

2. 2026 charitable deduction: The 0.5% AGI floor

One of the most significant changes in the 2025 Trump tax bill is the introduction of a "floor" for itemized deductions. Starting in 2026, you can only deduct charitable gifts that exceed 0.5% of your adjusted gross income (AGI).

This significant change effectively eliminates the tax benefit of smaller, routine donations.

For example, if you have a $200,000 AGI and donated $2,000 over the year:

• Your AGI floor is $1,000.
• Only $1,000 of your donation would be deductible.

The change might push more high-income donors toward "bunching" their contributions — making one large gift every few years — to clear the AGI floor and maximize their deductions.

Alternatively, taxpayers age 70½ or older might choose to make more qualified charitable distributions (QCDs), which the 0.5% AGI floor rule does not affect.

For more information on charitable contribution strategies, check out Kiplinger's report: How High Earners Can Maximize Their Charitable Contribution Donations.

3. The new 35% deduction cap for high-income donors in 2026

Charitable contributions for high-income itemizers are subject to a deduction cap in 2026. The new law imposes a 35% limit on the value of all itemized deductions for those in the highest income bracket.

This means top-bracket taxpayers (currently 37%) receive a lower effective tax break compared to last year.

For example, if you have a $2,000 deductible donation as a top federal-bracket earner:

• You could only get $700 in tax savings for 2026.
• In the prior tax year, that same donation resulted in $740 of savings.

Combined, the AGI floor and the charitable deduction cap are expected to lower the tax benefit for donating to charities for high-income earners in 2026.

2026 charitable deduction example: Calculating your new tax benefit

The table outlines how a top tax-bracket donor with an AGI of $1,000,000 with $400,000 in donations could receive a lower tax benefit in 2026 vs the 2025 rules.

Note: The "total potential tax benefit amount" does not reflect further AGI limits applied or other tax liability limitations applicable to high-income earners.

Important context for carryforwards: While excess contributions can still be carried forward for up to five years, any carryforwards used in 2026 and beyond are subject to the new limitations. As a result, a generous 2025 gift carried into 2026 could unexpectedly result in a smaller tax benefit than originally planned.

Summary of the OBBB changes to 2026 charitable tax rules

The 2025 Trump Tax Bill changed many rules regarding charitable donations. Those changes are summarized in the table.

The changes might not affect everyone, depending on your gifting strategy. Consult with a qualified tax professional to discuss which tax strategies are best for your financial circumstances.

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As the year draws to a close, it's a great time to review your financial and philanthropic goals.

For high-net-worth individuals, charitable trusts combine generosity with tax and estate planning. They deliver benefits beyond those of a direct donation or simple bequest — such as an immediate income tax deduction, potential capital gains deferral, estate tax reduction, income for a term of years or for life and the ability to leave a legacy for your heirs.

Charitable trusts in practice

Charitable trusts are split-interest vehicles, dividing a gift into two parts: an income benefit and a remainder benefit. This structure lets donors provide income for themselves or heirs, or leave a legacy to heirs, while ultimately benefiting charity.

This dual-purpose design is what makes charitable trusts so powerful for affluent families.

The two main types of charitable split-interest trusts are:

Charitable remainder trusts. CRTs are ideal if you want income today while maintaining charitable intent. By placing assets like cash, mutual funds or appreciated securities into the trust, you can receive income during your lifetime and avoid immediate capital gains taxes. After your passing, the remaining assets go to charity.

Charitable lead trusts. CLTs are best if you want to prioritize charitable giving now and leave a legacy for your family later. The charity receives income first — typically for 10, 15 or 20 years — and then your heirs inherit the remainder. CLTs can also help reduce gift and estate taxes. There are two main types:

• Grantor CLTs. Provide an upfront income tax deduction, but you pay tax on trust income during the term. Assets are out of your estate, and the grantor gets a gift tax charitable deduction, so there are estate tax benefits.
• Non-grantor CLTs. No upfront charitable deduction; undistributed trust income is taxed separately from your personal income, yet the trust gets the deduction. Assets are removed from your estate, which can reduce estate taxes.

Each trust type suits different goals. Start by clarifying what matters most: steady income, maximizing charitable impact or preserving wealth for future generations.

Determining the right fit

Charitable trusts appeal to wealthy individuals who want to integrate philanthropy with advanced tax planning. Unlike a direct donation, these trusts can provide additional benefits beyond the charitable deduction.

Funding options are flexible (cash, securities or other assets), but donating appreciated assets offers the additional benefit of avoiding capital gains tax.

Once you've decided on a CRT or CLT, choose the payout method:

• Annuity trust. Fixed annual payout — predictable, but could deplete trust assets if returns lag.
• Unitrust. Variable payout — drops if markets fall, but the trust won't run out because payouts are based on remaining assets.

Your choice depends on your cash flow needs, market outlook and overall objectives.

Tax and timing strategies

Tax benefits are a major reason wealthy investors choose charitable trusts over direct gifts. You may qualify for an immediate income tax deduction, defer capital gains and reduce estate taxes. CLTs may also offer estate tax advantages when transferring assets to heirs.

Planning ahead is critical because these trusts take time to set up and fund. Drafting documents, transferring assets and finalizing terms can be lengthy, so start early to ensure proper structure and maximize available tax benefits and work with a financial adviser and tax or trust professionals to align the strategy with your overall wealth plan.

Timing should be driven by your goals and your tax situation rather than the calendar.

Setting up a trust during a high-income year — such as after selling a business or property — can help offset taxes.

Interest rates also affect deduction and payout calculations, so consult with your adviser about the optimal timing.

A lasting legacy

Charitable trusts combine impact and tax efficiency, making them one of the most strategic ways to give. They allow you to support causes you care about while reducing taxes and preserving income or wealth for future generations.

They can also fit naturally into a broader estate plan, helping you balance charitable giving with family wealth transfer.

For affluent families, these trusts can serve as a cornerstone of multigenerational planning — providing income, reducing taxes and ensuring charitable commitments are honored.

Start with a clear vision of your goals and work with experienced professionals, including a financial adviser and tax or trust experts, to ensure your trust is structured correctly.

Your adviser can also help coordinate with legal and tax professionals to simplify the process.

Planning tools and modeling can help you determine the right funding amount and payout structure so your trust truly reflects your priorities.

With the right approach, you can turn your vision into reality, benefiting both your family and the charities that matter most.

Charitable trusts deliver both financial efficiency and meaningful impact, making them a powerful tool for affluent families planning for the future.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As 2025 winds down, many households find themselves pulled in many directions. Holiday gatherings, year-end work obligations and family commitments all compete for attention.

In the midst of that chaos, financial to-dos often could slip to the bottom of the list.

But the final stretch of the year can be one of the most meaningful windows for anyone looking to reset, refocus and shore up their finances before 2026 begins.

A quick year-end checkup could help reveal missed opportunities, prevent avoidable mistakes and present new planning options.

According to Fidelity's 2025 Financial Resolutions Study, 80% of respondents say having a plan and structure in place helps them deal with surprise events.

And for those who let their finances take a back seat in 2025, it may not be too late to finish the year strong.

Here are a few areas to focus on to help have a strong finish to 2025 and to start 2026 on solid footing.

1. Maximize your retirement contributions

Vanguard's 2025 How America Saves report found that only 14% of workers maxed out their 401(k) contributions in 2024. Year-end can be a perfect moment to see whether contributions can be increased to maximize tax-advantaged savings.

For 2025, workers can contribute up to $23,500 to 401(k) or 403(b) plans, plus there's a $7,500 catch-up for those 50 or older.

For 2026, the limits are $24,500 for employee contributions and an $8,000 catch-up for workers age 50-plus. There's also a "super catch-up" provision for 2025 that enables those who are 60 to 63 to contribute $11,250 extra, reverting to $7,500 at age 64.

A Roth conversion may also be worth exploring, especially with the recent extension of the Tax Cuts and Jobs Act (TCJA) provisions under the One Big Beautiful Bill Act (OBBBA).

Conversions tend to be most attractive in the years after retirement before required minimum distributions (RMDs) begin when taxable income may be lower.

This enables you to convert funds at potentially lower income tax rates, before you are required to take RMDs. Roth IRAs are not subject to RMDs, grow tax-deferred and withdrawals are tax-free.

2. Tap into qualified charitable distributions (QCDs)

For charitably minded individuals age 70½ or older, year-end presents another opportunity in the form of qualified charitable distributions (QCDs). A QCD is a distribution from an IRA sent directly to a qualified charity.

So long as the custodian sends the check directly to the organization, the distribution is not considered taxable income and may potentially reduce Medicare premiums. Individuals can donate up to $108,000 in 2025 ($216,000 for married couples filing jointly).

QCDs can also count toward satisfying RMDs for the year, resulting in a "win-win" for clients and their favorite causes.

3. Use remaining FSA and HSA dollars wisely

Flexible spending accounts (FSAs) operate under the "use it or lose it" rule, meaning unused funds often expire at year-end unless your employer provides a grace period. In short, now could be a good time to schedule medical appointments, purchase eligible supplies or get new glasses.

Health savings accounts (HSAs) remain one of the most powerful savings tools available, offering triple tax advantages: deductible contributions, tax-free growth and tax-free withdrawals for qualified health care expenses.

For 2025, individuals can contribute $4,300 and families $8,550, and those 55-plus get a $1,000 catch-up.

Given that Fidelity estimates* a 65-year-old single person retiring in 2025 will need an average of $172,500 for lifetime medical costs in retirement, regularly funding an HSA can be an important way to build long-term health care reserves.

It's important to note that you must be covered by a qualified high-deductible health plan (HDHP) to contribute to a HSA.

4. Review Social Security statements and credit reports

Last but not least, here are some simple but crucial housekeeping items — review your Social Security statements and credit reports. These are documents many people assume contain accurate information.

Social Security statements occasionally contain errors in wage histories, and those mistakes can lower your future benefits if left uncorrected.

Because discrepancies are far easier to fix early, individuals should log in annually at ssa.gov to confirm that their reported earnings match their actual income.

Credit reports deserve similar attention. Fraud and identity theft have surged, with the Federal Trade Commission (FTC) logging more than 1.1 million identity theft reports in 2024.

Reviewing reports from Equifax, Experian and TransUnion, all of which provide free annual access, can help reveal unfamiliar accounts or suspicious activity. If there are inaccuracies, each bureau offers dispute channels to address them quickly.

Whether or not something looks off, freezing credit remains one of the most effective ways to help protect against new fraudulent accounts or the continued misuse of compromised ones.

These practical defensive measures can help prevent further financial headaches that may otherwise take months or years to unravel.

Make it routine

Year-end planning shouldn't feel like a frantic scramble or a need-to-do stressor. Consider making it part of an annual rhythm, an intentional pause to ensure that your financial life still aligns with your needs, your values and the realities of changing tax laws.

For those who missed opportunities in 2025, this checklist can provide a road map for 2026. Successful financial planning isn't necessarily about perfection, but consistency. Small, deliberate actions taken regularly can compound into significant results over time.

At the outset of 2026, commit to making these reviews a standard part of your year-end calendar, because your financial security depends largely on proactive habits established today.

And if you feel overwhelmed, partnering with a trusted adviser can help you stay on track all year long.

* Estimate based on the person retiring with life expectancies that align with MP-2020 as of 2022. Actual assets needed may be more or less. Estimate is net of taxes.

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• Seven Things You Should Do Before 2026 Because of One Big Beautiful Bill Changes
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• 2026 HSA Contribution Limits Are Set: What to Know Now
• The Overlooked Generation: An Expert's Guide to How Gen X Can Finally Get Ahead

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As the Great Wealth Transfer moves trillions into new hands, women's longer life expectancy, growing financial decision-making power and dual inheritances as spouses and daughters position them to direct a significant share of philanthropic capital.

Let's explore five key trends shaping the landscape and how women can lead with clarity and confidence.

Trend No. 1: Wealth is flowing toward women

Many researchers have cited the Great Wealth Transfer that's underway from Baby Boomers to successive generations. But what isn't often noted is that women will have more time to spend as inheritors than men, as they generally have five years of additional life expectancy.

In addition, women stand to inherit twice from the impending wealth transfer over the next decade: Both from their parents and by outliving male partners. This transfer occurs in addition to the money women have earned and invested themselves.

Furthermore, the receipt of assets in divorce settlements also reflects a lateral transfer of wealth that can empower women's independent philanthropy. Significant charitable activity by MacKenzie Scott and Melinda French Gates post-divorce are two significant examples.

As a result, by 2030, American women are expected to control a substantial portion of the financial assets that Baby Boomers possess. For philanthropy specifically, one projection estimates that $18 trillion will pass to charities before 2048.

Consequently, women will have an increasing role in the oversight and disposition of the assets that pass for the benefit of charity, as they inherit this responsibility for private foundations, donor-advised funds and other charitable vehicles.

For many wealthy families, philanthropy often emerges as the first arena in which women begin to exert authority. Doing so requires an expanded awareness of the family's larger goals, as well as a strategy to optimize impact with the assets earmarked for charity.

Opportunity: Women can empower themselves for this sea change by:

• Distilling their core values to clarify their philanthropic philosophy
• Identifying common interests among the family to guide the establishment of its charitable vehicles
• Understanding the investment strategy in place for the family's charitable assets and checking for alignment with their purpose

Trend No. 2: Women give more than just money

Compared to men, women more often express their philanthropic spirit in various ways beyond traditional check-writing. Common examples include:

Volunteering

Historically, more women than men have volunteered in the U.S. overall.

While American men tend to volunteer through risky acts of rescuing and protective behaviors, such as safeguarding and firefighting, women favor activities that encourage "group-orientation, group facilitation and reciprocal relationships" and will remain in volunteer positions longer if they feel a sense of intimacy and belonging within the organization.

Volunteering spans a wide range of activities, from informal, ad hoc assistance to formal nonprofit board service.

While women represent the majority of board members for charities with up to $1 million in expenses, the reverse trend occurs for organizations with more than $1 million in annual expenses, for which the majority of board members are men.

Opportunity: Women have a chance to make a significant impact by joining nonprofit boards, contributing their strategic thinking and fiduciary leadership as well as their dollars.

Values-aligned investing

Investing in companies with positive environmental, social and governance (ESG) attributes, as well as impact investing beyond just a financial return, often accompanies philanthropy as another means of deploying capital toward positive change.

Women exhibit a greater inclination toward ESG or impact investing than men.

However, they express lower levels of familiarity with ESG, with only 23% indicating they are at all familiar, compared to 33% of men surveyed.

Opportunity: While the degree of actual knowledge varies among individuals, women can empower themselves further by learning more about investing to align with their values, in the context of asset allocation in general.

Civic participation

Interest in civic engagement also arises more for women as a means of effecting positive change.

In one study, women were more likely than men to leverage in-person networks by participating in a public event in discussing political views, volunteering for a candidate and/or talking to a child or teen about civic engagement.

In addition, as of 2020, "in every U.S. presidential election dating back to 1984, women reported having turned out to vote at slightly higher rates than men."

Opportunity: As voters, women can further encourage positive change beyond donating funds, casting their ballot not just in federal elections but also in state and local elections, and serving as a family role model in demonstrating the importance of voting.

Trend No. 3: Women recognize the power of giving collectively

Supporting common causes alongside other donors aggregates valuable intel and action, in addition to dollars.

Giving circles have emerged as a way for donors to align their philanthropy by pooling their research and capital in distributing grants in a specific area.

In the U.S., 70% of U.S. giving circles report that women make up more than half of their members.

Opportunity: Women can explore the potential of bonding and giving with others through resources hosted by Charity Navigator.

Trend No. 4: Women value giving based on trust

Compared to traditional donations limited to specific projects and detailed prerequisites, trust-based philanthropy has emerged as an approach rooted in open and transparent relationships between funders and grantees.

Under this approach, unrestricted general operating support allows leaders to respond quickly to changing circumstances and community needs, especially during times of crisis.

Women show a greater inclination to donate based on trust and transparency than men.

MacKenzie Scott has exemplified this approach by giving more than $19 billion in unrestricted support to more than 2,000 organizations, with research confirming that Scott's donations have transformed and strengthened the recipients.

Opportunity: Women may experiment with trust-based philanthropy by:

• Identifying their most gratifying giving experiences
• Meeting with the receiving charity's leadership
• Understanding the charity's overall challenges
• Considering unrestricted donations to further advance their work

Trend No. 5: Supporting women and girls remains an untapped opportunity

Research has verified that women globally spend more time in poor health relative to men. But it has also confirmed the return in investment in their well-being would have a multiplier effect on their families and communities.

Specifically, improving the health and lives of millions of women could boost the global economy by at least $1 trillion annually by 2040.

Despite the outsized benefit of supporting the health and well-being of women and girls, who represent at least half the population, the allocation of all giving in the U.S. to women's and girls' organizations hovers at roughly 2%.

Opportunity: Women can address this relative underinvestment by exploring organizations specifically focused on supporting the health, education and well-being of women and girls.

A new era of philanthropic leadership

As women face an unprecedented wave of opportunity for charitable capital, they can maximize their impact both financially and personally within their families and communities by strategically partnering with nonprofit organizations and allying with others.

In doing so, they can commence a pivotal era of philanthropic leadership.

Related Content

• Great Wealth Transfer: How Families Can Get on the Same Page
• In Family Philanthropy, Embracing Differences Can Pay Off
• Five Pitfalls That Can Trip Up Your Family's Charitable Giving
• Five Ways to Adapt Your Charitable Giving Strategy in a Changing World: An Expert Guide
• What Can a Donor-Advised Fund Do for You? (A Lot)

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

The end of the year is a crucial time for charitable giving. Whether you are giving cash, stock, or using your IRA to make a qualified charitable distribution, meeting specific year-end deadlines is essential.

Donating to charities and nonprofits is more common during the holiday season. Half (51%) of U.S. adults report having donated or planning to donate money by the end of 2025, with a fifth of those donating exclusively in the final months of the year, according to Charities Aid Foundation America. For retirees, charitable giving is not merely an act of generosity — it is a sophisticated tax-management strategy, particularly when dealing with retirement accounts.

Once you reach age 73 (or 75 in 2033), you must begin taking Required Minimum Distributions (RMDs) from your traditional IRAs. These RMDs are added to your taxable income, which can lead to higher taxes on Social Security benefits or increase Medicare premiums by triggering the IRMAA. To counteract this, strategic charitable gifts can be used to meet your RMD requirement without adding a single dollar to your Adjusted Gross Income (AGI), thereby protecting you from the associated tax hikes.

Another way to reduce your taxable income is to gift appreciated assets, such as mutual funds and stock. This can help you avoid a spike in income from capital gains you'd have to report if you sold the assets.

Here are the deadlines and details for charitable giving that can help reduce your RMDs and capital gains.

IRA Qualified Charitable Distributions (QCDs)

The best way to satisfy your RMD requirement and avoid including it in your annual income is with the Qualified Charitable Distribution (QCD). If you are aged 70-1/2 or older, you are eligible to transfer up to a statutory limit, $108,000 for individuals and $218,000 for couples in 2025, directly from your IRA to an eligible charity. Because the money never touches your hands, it is excluded from your taxable income — a much more powerful benefit than taking the RMD and then claiming an itemized deduction for a charitable contribution. This direct transfer satisfies your RMD requirement while supporting your favorite causes and lowering your taxable income for the year.

To secure the tax benefits of a QCD, your donation must clear your IRA account by the December 31 deadline. Since processing can take time, it is essential to initiate the transfer early to ensure the funds leave your account before the end of the year.

If you are relying on a QCD to satisfy your RMD, waiting until the last week of the year is risky, as delays in processing by your custodian can nullify the tax benefit. Retirees should coordinate with their financial advisor and IRA administrator to ensure the distribution is fully executed and recorded by year-end, securing both the charitable gift and the tax savings.

Looming deadlines

The official deadline for many charitable gifts is December 31st, but the cut-off dates for transfers and processing can often be much earlier, depending on the method of giving, according to planninggiving.com.

Planning is essential to manage MAGI in retirement. For more robust explanations about the types of income that can trip up retirees, read 7 Ways to Plan Now to Save on Medicare IRMAA Surcharges Later.

Call the charity/nonprofit

Before sending any gift, especially a non-cash asset or a large year-end contribution, take a few minutes to call the nonprofit organization.

A quick call will allow you to:

• Confirm what types of assets they can accept
• Inform them of any upcoming large transfers, such as stock or wire transfers
• Confirm their internal processing cut-offs, as some organizations may have limited business hours over the holidays

Related Content

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• How to Calculate Your RMDs (Required Minimum Distributions) for IRAs
• How Charitable Donations Can Reduce Your Taxes
• Required Minimum Distributions (RMDs): Rules, Deadlines, and SECURE 2.0 Changes
• 4 Smart Ways Retirees Can Give More to Charity, From a Financial Adviser

One of the great privileges of retirement is being able to give back.

After years of saving, working and providing for family, many people find generosity becomes one of life's most meaningful pursuits.

Whether you're supporting your church, backing medical research or helping your community thrive, giving brings joy and purpose.

How you give matters. The way you structure your charitable gifts can impact not only the organizations you support, but also your taxes, your income plan and your family's legacy.

That's why more retirees are turning to donor-advised funds (DAFs). They're not just for billionaires — nearly half of all DAF accounts in the U.S. hold less than $50,000, according to the 2024 National Study on Donor Advised Funds by The Donor Advised Fund Research Collaborative (DAFRC).

For many families, they offer a simple, tax-savvy way to align generosity with a broader retirement strategy.

A simple idea with flexible timing

Here's how a DAF works: You contribute cash or appreciated investments into the account, often during a high-income year. That contribution counts as a charitable gift right away, which might qualify for an immediate tax deduction.

The funds can then be invested and potentially grow tax-free.

You recommend grants from the account to your favorite charities on your own schedule — whether that's tomorrow or several years down the road.

That timing flexibility is what makes a DAF so powerful for retirees. Think about the final year of full-time work or the sale of a business or long-time family home. Those events can push taxable income to unusually high levels.

Contributing to a DAF in that same year can help offset the tax bill, while allowing you to spread the actual charitable dollars out slowly over future years.

Turning many small gifts into one smart move

Even without a big sale or income spike, DAFs shine when combined with a bundling strategy. Many retirees find their usual annual gifts no longer provide a tax deduction because they don't exceed the standard deduction.

Instead of giving $10,000 each year and never itemizing, you might contribute $50,000 to a DAF once every five years. You'd receive a meaningful deduction in the contribution year, then direct grants of $10,000 annually to the same charities you've always supported.

From the charity's perspective, nothing changes. From your perspective, you've captured tax savings that otherwise would have been lost.

Research shows that's exactly how many retirees use DAFs. Contributions tend to be larger and less frequent — often in the $10,000 to $50,000 range, according to the DAFRC study — while grants flow steadily over time.

More than half the contributions are granted within three years, and nearly 60% are granted within eight years.

Beyond cash: Donating appreciated assets

Another reason DAFs fit so well in retirement planning is their ability to accept appreciated securities. Instead of selling stock and paying capital gains taxes, you can contribute the shares directly to a DAF.

You avoid the tax on the gain, receive a deduction for the full fair market value and free up your portfolio to be rebalanced.

For retirees who built significant wealth through employer stock or a single investment, this can be a win-win: reduce risk in the portfolio while increasing the impact of charitable giving.

Steady giving, organized and simplified

One common misconception is that DAFs "lock money away" and delay support for charities. The DAFRC study shows otherwise:

• 78% of accounts made at least one grant within three years.
• Median payout rates were 15% for active accounts, significantly above the 5% private foundations are required to distribute.
• Most funds get disbursed quickly. Over half of contributions are granted within three years.

In other words, most retirees use DAFs to organize and smooth their giving, not delay it indefinitely.

The system is also well organized. Instead of juggling dozens of receipts for different charities each December, you make one contribution to the DAF.

Come tax time, you track only that one gift. The sponsor handles the paperwork, the reporting and the distributions to your chosen nonprofits.

A built-in legacy

Nearly all DAFs (92%) include a succession plan. You can name children or grandchildren as advisers, giving them a hands-on role in charitable decisions after you're gone.

Some families use annual grantmaking meetings as a way to pass down values of stewardship and generosity. Others choose to direct the remainder to a favorite charity outright.

Either way, it's a simple, turnkey approach to legacy giving — without the complexity of setting up a private foundation.

Questions to consider

If you're charitably inclined, here are a few questions worth asking:

• Do you anticipate a high-income year from retirement, a home sale or portfolio rebalancing?
• Could bundling several years of giving into one DAF contribution help you capture deductions more efficiently?
• Would donating appreciated stock reduce risk in your portfolio while maximizing charitable dollars?
• Do you want to involve children or grandchildren in carrying forward your charitable vision?

The bottom line

Charitable giving in retirement should be about more than just writing checks. It should be about maximizing impact, capturing available tax savings and creating a legacy of generosity.

A DAF can help you do that. By bundling gifts strategically, contributing appreciated assets and aligning giving with high-income years, you can keep more of your retirement dollars working for the causes you care about, rather than sending them to Uncle Sam.

If giving is an integral part of your retirement vision, now is the time to explore whether a DAF fits into your plan.

With the right strategy, you can simplify your giving, strengthen your legacy and find peace of mind knowing your generosity is making the difference you intend.

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

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• Running Out of Money in Retirement: Nine Steps to Help Reduce the Risk

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Anyone who’s a fan of holiday movies is no doubt familiar with Charles Dickens' "A Christmas Carol."

The story is about how Ebenezer Scrooge, a miserly old man who swims through hoards of gold coins in some retellings, is transformed into a generous soul after he receives a visit from four spirits on Christmas Eve.

While most of us probably hope we’re not as frugal as Scrooge, we still enjoy a good deal when we see one. That’s why his dramatic change of heart holds a critical tax lesson: The most powerful way to lower your tax bill this season may be to give.

By employing this "Scrooge Strategy," you can donate gifts, clothes, and other old "junk" to squeeze out one last tax break before December 31. It might not be mounds of gold, but hey — every bit helps, right?

This article covers the federal income tax deduction. States may offer some variation of the charitable contribution deduction, if any. See your state's Department of Revenue or Taxation website for more information.

Charitable donations for the 'Scrooge' strategy

We all have those items piling in the back of our closets waiting to be used. So why not donate them?

Not only will you be helping someone in need, but you may be able to claim the charitable donation deduction on your 2025 federal income return if you itemize (rather than claim the standard deduction).

Yet before we dive into the types of donated goods that qualify for a potential tax break, we’ll first need to lay out some ground rules. Namely, the IRS rules on the eligibility of donated goods employing the "Scrooge" strategy.

1. The item must be donated to a qualified tax-exempt 501(c)3 organization (e.g., Goodwill, Toys for Tots, churches, etc.). You can verify an organization’s tax-exempt status via the IRS Tax Exempt Organization Search tool.
   
2. Donated goods must be in "good used condition" or better to be deductible. Nothing of poor quality will be accepted as a tax deduction (unless you can prove your item is worth more than $500 by a qualified appraiser).
   
3. The deductible amount of your donated goods is equal to the fair market value (FMV) at the time of donation, not what you originally paid. This means that if you’re donating to a thrift or consignment shop (like Goodwill), it’ll be for the amount they can sell the item.

You should keep detailed tax records of your donated goods. For example, if you donate $100 worth of old mugs to the Salvation Army, you'll at least want a description of the items, their value, and how that value was determined.

Written acknowledgement is a requirement for any non-cash goods donated that are worth $250 or more. You can often get this written notice by asking the organization you donated to for proof of donation.

Lastly, any one item or group of items worth over $5,000 must be appraised by a qualified appraiser to confirm their value (though most of us likely don’t have $5K lying around our closets, do we?).

Note: Collectibles, fine art, and other items that are valued over $5,000 may only be deducted based on FMV if the charity uses the item in a related way. So, for example, if you donate a painting to a museum that uses the art on display, that could be deductible at FMV. Otherwise, your deduction may be limited to your original cost basis in the item.

Charitable deduction deadline checklist

Just as Scrooge awoke on Christmas, relieved it was not too late to change his miserly ways, you also have time to make a non-cash contribution to charity before year-end. But you'd better hurry. The deadline to contribute for the 2025 tax year is December 31.

Here's a checklist of items you may find in your attic or closet that could count toward the federal charitable tax deduction:

While individually the items may not be worth much, the total value of your donated goods could quickly add up. And if you’re on the cusp of claiming the itemized or the standard deduction for the 2025 tax year, any extra donated goods could push you to itemize for a higher tax break. This could be particularly important given that new charitable deduction rules next year will further limit non-cash charity deductions.

Starting in 2026, all itemizers will be subject to a new deduction floor of .5% of their adjusted gross income (AGI). Any charitable contributions (including non-cash) below this threshold will be non-deductible.

Note: Appreciated stock, real estate, and other items that are typically not stored in the back of a closet or attic were excluded from this list. However, consult with a qualified tax professional before making a high-value donation, as different rules and tax planning considerations may apply.

Tax deduction for a charitable donation

Although we covered eligibility rules and examples of what could qualify for a charitable contribution tax break, some additional IRS guidelines limit how much you can claim on your federal income return for your non-cash charity deduction.

• Ordinary property held less than a year (like clothing, household items, etc.) is limited to your cost basis and 50% of your AGI.
• Appreciated long-term capital gain property (like artwork, jewelry, etc.) is limited to FMV and 30% of your AGI.
• If you donate long-term property to a private foundation, that’s generally limited to cost basis and 20% of your AGI.

However, there may be a silver lining: If your donation exceeds your AGI for the tax year, the leftover amounts may be carried over into the future, up to five tax years. So if you plan to itemize again, your non-cash contributions could qualify on next year’s return — but even if they don't, your charitable intentions will surely be appreciated by the charity of your choice.

Read More

• How Charitable Donations Can Reduce Your Taxes
• 3 Ways High-Income Earners Can Maximize Their Charitable Donations
• The Gift Tax Exclusion for 2025 and 2026 Is Here
• What Is a Qualified Charitable Distribution (QCD)?

As a financial professional, you build your business on trust. Clients seek guidance on their most important life decisions, and that relationship is founded on more than just numbers. It's about connection.

What if you could deepen that connection, expand your reach and strengthen your team while making a tangible difference in your community?

Strategic community engagement offers a powerful way to do that. It's about aligning your firm's values with meaningful action.

The benefits go far beyond a simple tax deduction. When done right, giving back can boost brand recognition, drive referrals and foster a company culture that top talent wants to be a part of.

Let's explore how real advisers are turning community spirit into business growth.

Build your brand by building your community

In a crowded marketplace, a strong brand helps you stand out. Community involvement is an authentic way to show your firm's values.

Instead of just telling people about your causes, demonstrate them through action, creating a reputation that marketing dollars can't buy.

Just ask Rob Russell of Russell Total Wealth and Wellness. His Dayton, Ohio, firm decided to move beyond sporadic donations and focus its philanthropic efforts on four core pillars:

• Supporting military veterans and first responders
• Mentoring local youth
• Improving community health care
• Boosting Dayton's business reputation

By becoming a lead sponsor for such organizations as Big Brothers Big Sisters, the Russell name became highly visible at local events.

This strategic approach didn't just feel good; it helped elevate the firm's profile and showed the community who they were.

Turn authentic connections into client relationships

Many advisers find their best clients through referrals, which are built on trust. Community engagement is a natural way to build that trust on a wider scale.

When potential clients see you and your team volunteering or passionately supporting a local cause, they see you as more than just an adviser. They see you as a neighbor.

This is exactly what the team at Russell Total Wealth and Wellness experienced. The firm's deep community involvement led to referrals, including a client who likely would have never attended a traditional seminar. These clients were drawn to the firm's genuine commitment to the community.

David Brooks of Retire SMART found a similar path to connection, with a different method. His calls strategy involves re-engaging past prospects with timely, relevant information.

By reaching out with a thoughtful message tied to current events, he turns a cold lead into a warm conversation.

This approach, focused on personal connections, helped bring in a substantial number of assets in a single year. It proves that focusing on people first pays off.

Strengthen your culture and engage your team

A strong company culture is essential for attracting and retaining great employees. People want to work for a company with a purpose beyond the bottom line.

Involving your team in community initiatives can increase morale, foster teamwork and create a shared sense of pride.

Chad Slagle of Slagle Financial saw his employees become more engaged — and more grateful to work for a company with heart — by shifting to a service-oriented mission. Spurred to action by the death of a local police officer who left behind a wife and daughter, Chad founded Teaming Up for Good, his firm's philanthropic wing.

The initiative, which supports first responders, the military and children, gave his team a powerful cause to rally around. It transformed their workplace into a community of people making a difference together.

Create a legacy of lasting impact

While the business benefits are clear, the most profound outcome of community engagement is the positive change you create. By addressing local needs, you can help build a legacy that lasts.

Slagle's support for the Tyler Timmins Memorial Foundation, created in honor of the fallen officer, shows how a firm can help heal and strengthen its community in a time of need.

Similarly, Josh Bradley of Capital City Financial Partners hosted educational events with FBI agents to teach clients about elder fraud and cybersecurity. By providing this vital service, his firm became a trusted advocate for its community's most vulnerable members.

Actionable steps to get started

Ready to harness the power of giving? Here's how you can start:

Define your mission. Identify causes that align with your firm's values and resonate with your team. What are you passionate about?

Plan with purpose. Start small. You don't need a massive budget to make a difference. Choose one or two initiatives, and do them well.

Involve your team. Ask your employees what causes they value. Giving them a voice will increase buy-in and engagement.

Partner for impact: Collaborate with local nonprofits or community organizations. They have the expertise and infrastructure to help you make a real impact.

Share your story. Let your clients and community know what you're doing. Share updates in your newsletter, on social media or at client events. This inspires others and reinforces your brand's commitment.

Ultimately, integrating community engagement into your business model is a win-win. You'll build a stronger business, a more engaged team and a better community. It's a powerful reminder that doing good truly is good for business.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

For many people, charitable giving feels like something to focus on later in life, after retirement, when there's more time to reflect and plan.

But from a financial standpoint, the most powerful time to give is often while you're still earning.

That may sound counterintuitive. After all, retirement is when you finally have clarity about what you can afford to give away.

But the truth is, charitable gifts made during your peak earning years can have a bigger financial impact — both for you and for the organizations you support.

1. Tax advantages today, generosity in the future

Here's an example to better illustrate: Deductions are most valuable when your income, and therefore your tax bracket, is at its highest. A $10,000 donation can feel very different depending on when it's made.

If you're in the 35% tax bracket, that gift could save you $3,500 in taxes. Make the same contribution after you've retired and dropped into a 22% bracket, and the tax savings fall to $2,200.

The charitable impact is the same, but the benefit to you is nearly 60% greater during your earning years.

That doesn't mean you have to give away a large sum all at once. One of the best tools for bridging today's tax advantages with tomorrow's generosity is a donor-advised fund (DAF).

These funds allow you to make a sizable, tax-deductible contribution in a high-income year, but decide later how and when to distribute the money to the charities you care about.

It's like setting aside cash in your "charitable account." You lock in the deduction now, but retain the flexibility to give gradually, even long after you've retired.

This approach can be especially useful if you're expecting a one-time jump in income, such as selling a business, receiving a bonus or exercising stock options.

You can offset some of that taxable income by funding a donor-advised account in the same year.

2. High interest rates can work in your favor

Today's higher interest rate environment has also made certain charitable strategies more appealing than they've been in years. Vehicles like charitable remainder trusts or charitable gift annuities can provide reliable income streams for you or your loved ones while ultimately benefiting the causes you support.

With rates up, those income streams are often higher, a welcome development for anyone seeking both generosity and financial security.

3. You'll make an impact now

The bigger picture here is that giving shouldn't be an afterthought or something reserved for the end of your career.

It can be a living, active part of your financial plan, and a way to align your wealth with your values while you're still building both.

The key is understanding what you need to support your lifestyle and what constitutes excess net worth that could be put to work for others.

When giving is integrated into your broader plan, it not only helps you make the most of your resources but also adds purpose to your financial life.

You don't have to wait for retirement to make an impact. You can start now. Often, that's when your generosity goes the farthest.

Related Content

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• I'm a Financial Planner: Here Are Three High-Impact Ways to Make a Difference With Your Dollars
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• Five Ways to Adapt Your Charitable Giving Strategy in a Changing World: An Expert Guide
• Like Getting Healthy, Getting Wealthy Requires Good Habits

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Many people choose to make philanthropy a priority in retirement, using their resources to bless others and fund a charitable legacy.

Years of hard work and saving provide them with an opportunity to give back in a meaningful way.

But here's the challenge: Without a proactive tax plan, retirees often pay far more to the IRS than they have to, which can limit the amount that reaches the causes they care about most.

Being more intentional about the timing and structure of your charitable contributions can allow you to minimize your tax liability and maximize the impact of your gifts.

Here are four practical strategies that can help make your giving more tax-efficient.

1. Turn your RMD into a tax-free gift

Once you turn 73, you must make required minimum distributions (RMDs) every year from your tax-deferred accounts. These withdrawals are taxed as ordinary income, and they can easily nudge you into a higher tax bracket.

That could trigger a tax on up to 85% of your Social Security benefits and potentially raise the cost of your Medicare premiums.

For those who are charitably inclined, a qualified charitable donation (QCD) can be one of the simplest solutions. If you're 70½ or older, QCDs allow you to make tax-free donations directly from your IRA to a qualified charity.

The donation can satisfy all or a portion of your RMD and isn't reported as taxable income on your tax return. Your charity receives the full distribution, and the IRS gets nothing.

You can make a QCD from any tax-deferred IRA account, such as a traditional IRA, inherited IRA, or a SIMPLE IRA or SEP IRA that you're no longer contributing to. (You cannot use a 401(k) or similar workplace plan.)

In 2025, you can donate up to $108,000, and if you're married, each spouse can donate up to his or her individual annual limit. Just be sure the QCD goes directly from your custodian to the charity. The IRS says the funds can't touch your bank account.

2. Give appreciated stock, not cash

If you own stocks, mutual funds or exchange-traded funds (ETFs) that you've held for more than a year, you may find it makes sense to donate those investments directly to your church or a charity instead of selling them and giving cash.

Here's why: When you sell securities that have appreciated in value over time, the gains are subject to capital gains taxes. Depending on where you live, you also could owe state taxes on the gain.

But if you donate those investments directly to a qualified charity, you won't pay capital gains tax. Instead, you'll get a tax deduction for the full fair market value of the securities at the time of the transfer (if you itemize).

The tax deduction limit is up to 30% of your adjusted gross income, but you can carry over any excess for up to five years.

Meanwhile, the charity can sell the positions and pay zero taxes on the capital gains. If your church or nonprofit doesn't have a brokerage account, many custodians or local community foundations can help facilitate the transfer.

3. Name a charity as a beneficiary of your IRA or 401(k)

If you have more money saved in your 401(k) or traditional IRA than you expect to spend in retirement, you may be planning to designate your child or another loved one as the account's beneficiary when you pass.

But for many people, leaving the account to a favorite charity, or charities, can be a more tax-efficient option.

That's because when a qualified charitable organization receives a distribution from a traditional IRA, it doesn't have to pay income tax on the funds. This is a notable advantage compared to a child or other non-spousal beneficiary, who would have to pay ordinary income tax each year on any withdrawals from the account.

In most cases, family members are now required to take distributions from pretax accounts within 10 years, which could push your beneficiary into a higher tax bracket (especially if they're in their peak earning years).

In other words, leaving $200,000 to a specific charity through a traditional IRA would provide the charity with $200,000 to use.

But if that $200,000 IRA were to go to a non-spousal beneficiary, the taxes owed would likely eat up a good-sized chunk of that generous gift.

Your loved ones would probably be happier to receive a tax-free life insurance payout, a Roth IRA or another tax-smart option.

4. Make a difference with a donor-advised fund

Donor-advised funds (DAFs) have gained popularity since the Tax Cuts and Jobs Act (TCJA) changed the rules for writing off charitable contributions starting in 2018.

With a DAF, you can bundle or "bunch" several years' worth of donations into one large contribution (in cash or assets) to meet the TCJA threshold for itemizing charitable deductions in that year.

Instead of going directly to a charity in one lump sum, your donation is then invested by the DAF's sponsoring organization. And once it's invested, the donation can continue to grow tax-free until it is paid out, also tax-free, to qualifying causes over time.

Though you'll no longer have a legal right to the money in the DAF, you will have "advisory" privileges, which means you can help plan when and to whom you wish to make grants.

A DAF is relatively easy and inexpensive to set up — and it's a tax-smart way to follow through on your gifting goals.

Faithful giving, wise stewardship

I don't know many people who would say that getting a tax deduction is their top motivation for charitable giving. For most folks, it's more about their value system or part of their faith journey.

Still, tax efficiency can be an important consideration for many donors. The right strategy can help you be a better steward and allow you to give cheerfully, knowing you're making the maximum impact with your money.

An experienced financial adviser can walk you through the pros and cons — and the sometimes complex IRS rules — for these and other gifting options. Don't hesitate to ask for help so you can find the best fit for your family's giving goals.

Kim Franke-Folstad contributed to this article.

The appearances in Kiplinger were obtained through a PR program. The columnist received assistance from a public relations firm in preparing this piece for submission to Kiplinger.com. Kiplinger was not compensated in any way.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

The One Big Beautiful Bill (OBBB) will usher in many changes. The most significant involve updates to the U.S. tax code in regard to charitable deductions for philanthropically minded Americans.

High-net-worth donors must contend with stipulations coming into effect on January 1, 2026:

New floor on deductions for itemizers. Philanthropic donations at or below 0.5% of a filer's adjusted gross income will not provide any deductions.

Cap on deductions for top tax bracket. The deduction value of itemized charitable donations will be capped at 35% for filers in the 37% tax bracket (the highest).

New universal charitable deduction for nonitemizers. Tax filers who don't itemize their charitable deductions will be subject to a universal deduction amount — up to $1,000 for single individuals and up to $2,000 for married couples.

This universal deduction does not apply to contributions made to donor-advised funds (DAFs) or private foundations. To receive this new deduction, the gift must be made with cash; donations of appreciated securities will not trigger this new deduction.

Unused deductions are subject to new floors and caps. Charitable deductions that weren't applied to tax returns might still be carried forward to the next year's filing, but any donations carried over into 2026 or later are also subject to the above new floor and caps.

What do these new rules ultimately mean? After the New Year, smaller or routine philanthropic donations might not be able to contribute nearly as much in tax deductions — or will contribute nothing in deductions.

Further, affluent donors who make sizable donations will reap considerably less in tax advantages.

That makes year-end charitable giving and tax planning before 2025 runs out more urgent than ever. For the remainder of the year, taxpayers can consider certain strategic moves that can potentially maximize the tax deductions on charitable gifts made in 2025:

Consolidate multiyear gifts into 2025 filings. Instead of spreading multiyear philanthropic gifts over time, their full amounts should be filed for the 2025 tax year.

That way, the deductions on multiyear gifts won't be affected by the new rules going into effect on January 1.

Prefund multiyear gifts into a donor-advised fund now. Setting up a DAF before 2025 runs out to prefund charitable gifts can also ensure any potential deductions can fall under the 2025 deduction rules.

Keep an eye on adjusted gross income. Since the 0.5% deduction floor is tied to a filer's adjusted gross income, taxpayers need to keep that in mind as they plan charitable gifts going forward.

Business sales and other events which can decrease or increase adjusted gross income will also affect the deduction potential of charitable donations made in years in which that income is either lower or higher.

The window from now through December 31, 2025, grants taxpayers a crucial period for reviewing year-end charitable giving planning ahead of the OBBB's charitable deduction stipulations.

The new rules with regard to deductions will change the potential tax benefit derived from large, ongoing donations to philanthropic causes.

Planning now can help lock in deductions on multiyear gifts under the current calculations, and also potentially optimize deductions on donations made in future tax years.

Related Content

• How Charitable Donations Can Reduce Your Taxes
• 3 Ways High-Income Earners Can Maximize Their Charitable Donations in 2025
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• How to Choose the Best Charities to Donate To
• Three Factors Sabotaging Your Long-Term Investment Strategy

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

With the holidays right around the corner, this is the time many of us give back to our favorite charities.

Despite many Americans struggling with finances in the midst of lingering inflation and high credit card debt, charitable giving increased 6.3% to $592.5 billion in 2024, according to Giving USA's 2025 Annual Report on Philanthropy.

You shouldn't donate to a charity simply for a tax write-off. Instead, find one that means something to you or your loved ones.

Whether it's a local shelter for homeless people or animals or an organization that's important to you, like Feeding America Wisconsin is important to me, many organizations could use your help.

While there are many ways to give, some strategies can be more impactful than others. By understanding how to maximize your charitable donations, you can make the most of your gifts while staying on budget.

Take advantage of tax benefits

You can save more on taxes if you have the right strategy for donations, which also gives you the ability to donate more. To encourage charitable giving, the IRS offers tax deductions for donations made throughout the year.

However, to claim these deductions, you need the right paperwork and have it filed correctly.

If you're seeking a tax deduction, make sure your donation falls under the IRS's definition of a charitable donation. You can donate to organizations that are registered as tax-exempt, including such places as churches and religious organizations or museums and educational groups.

But be careful — not all nonprofits are tax-exempt, so do your homework before you choose.

If you plan to make donations next year, a few changes that you need to be aware of are coming from the One Big Beautiful Bill (OBBB).

Beginning in 2026, universal deductions are changing for non-itemizers. If you're a single filer, you can deduct up to $1,000 in cash donations, and if you're married, that number goes up to $2,000.

Also starting next year, if you itemize your deductions, you're required to contribute at least 0.5% of your adjusted gross income before claiming any charitable deductions.

If you earn a higher income, the value of your charitable deduction is now capped at 35%, down from 36% in previous years. While this might seem like a slight change, this could significantly impact your donations moving forward.

Consider qualified charitable distributions

If you turned 73 this year, you have until April 2026 to begin taking your required minimum distribution (RMD). A way to meet your annual RMD is by using a qualified charitable distribution (QCD). This allows those age 70½ and older to make donations of up to $100,000 from their IRA.

When you make a distribution from your IRA, those are pre-tax dollars and can be used to meet your annual RMD. This will reduce your adjusted gross income and can go directly to charity without being taxed when you withdraw.

If you're worried you don't have enough extra funds to donate to charity this year, that's okay.

I recommend working with a financial professional. They can help you determine the best ways to maximize your donation while still staying within your budget.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Some lessons we teach our kids come naturally, such as saying "please" or "thank you."

Others take a little more creativity and patience. Teaching them to give back definitely falls into that second category.

Generosity doesn't happen overnight. Kids learn it by watching, feeling and doing. As parents, we're constantly walking that line between wanting them to appreciate what they have and not turning every lesson into a lecture.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

Five simple, meaningful strategies can help your kids understand what it means to give back in ways that fit your family's real life.

1. Start with gratitude

In our house, gratitude is something we try to instill in our kids. It isn't some big "sit in a circle and reflect" moment, but more like, "What made you smile today?" or "What was the best part of your day?"

These tiny moments help kids realize how much they already have, whether it be friends, family, food or a home … things we adults sometimes take for granted. When kids start noticing the good, they naturally want to share it.

Studies, such as one by Robert Emmons, a leading expert on gratitude, show that practicing gratitude for five minutes each day can make you 25% happier.

2. Let them take the lead

Kids have big hearts and even bigger opinions. If you've ever tried picking out an outfit for your daughter, you know exactly what I mean. It helps to let them take the lead when it comes to giving.

Maybe your child wants to donate old toys, help animals or collect food for families in need. When the choice is theirs, they feel ownership, and that's when it really starts to click.

I learned this the hard way when I tried to clean out my kids' toys on my own. Let's just say it didn't go well.

But once I gave them the time and space to go through their things and imagine another child playing with those toys, everything changed. It became fun, thoughtful and surprisingly meaningful.

3. Volunteer as a family

Some of my favorite memories come from the things we've done as a family. Look for ways to make giving back a shared experience, such as baking cookies for a school fundraiser, joining a beach cleanup or volunteering at a local shelter or food bank.

Even if everyone grumbles about it at first, those are often the moments that turn into the best stories later.

I've heard families talk about their annual Turkey Trot runs. Every year, everyone complains about waking up early, yet those mornings are the ones they laugh about most.

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Kids love feeling like part of a team, and when giving back becomes a family tradition, it stops feeling like something everyone "should" do and becomes something special you want to do. It's one of those things that brings people closer together.

Studies found that 81% of parents who give reported that their children under age 18 also participated in a charitable activity in the past year.

4. Build giving into their allowance

If your kids get an allowance, make generosity part of the plan. Encourage them to budget a portion for saving, a portion for spending and a portion for giving.

For example, if they receive a weekly allowance, have them set aside a few dollars or a small percentage for a cause or organization that matters to them. It's a simple way to teach both financial responsibility and the joy that comes from helping others.

5. Involve kids in philanthropic decision-making

If giving is already part of your family's budget and your kids are a little older, invite them to be part of the process. Let them research and suggest which organizations your family might want to support.

They can explore sites such as Charity Navigator or Charity Watch to learn about different causes and how nonprofits use their funds.

You can make it fun by turning it into a friendly "pitch session," in which each child presents their favorite cause and everyone votes on where the donation goes.

If your family gives regularly, you might also explore opening a donor-advised fund (DAF), a vehicle that allows you to donate cash, appreciated securities and other assets and receive an immediate tax deduction.

The funds can be invested for tax-free growth, and you can direct grants to eligible charities.

For families giving larger amounts, a family foundation can be another great option, offering more structure and long-term involvement. Essentially, you're establishing your own private charitable organization funded with family assets and controlled by your family.

As your kids grow, they can take an active role in managing the fund or foundation.

The heart of it all

Teaching our kids about giving back isn't about big donations or perfect parenting moments. It's about raising kind humans who notice the world around them.

When our kids learn that even the smallest act of kindness matters, whether it be sharing a snack, helping a friend or donating a toy, they begin to see themselves as part of something bigger.

That's what it all comes down to: Helping them see that their actions, no matter how small, can make a real difference in someone's day and in the world around them.

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When was the last time that you were paying for your groceries or other items, and the cashier asked, "Would you like to round up your total for charity?" Perhaps they didn't tell you which charity. Or maybe they simply asked, "Would you like to round it up?"

That's what "Sylvia" and her mother encountered at a home decor chain store that sells bedding, kitchenware and holiday goods.

"After all of our items were rung up, my mom paid in cash, and then the cashier said, 'Would you like to round it up?' Mom said, 'Sure, no worry. There is a shortage of pennies. That's fine. We don't need them.'"

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

"At home, we were reviewing the receipt and saw that the last entry was a 32-cent payment to St. Jude (Children's Research Hospital). Totally unexpected! We had made a charitable donation without realizing it.

"We don't object to the donation, but we feel we were misled because we weren't informed where our money would go and therefore didn't give our consent.

"I think this is something you might look into, Mr. Beaver. How widespread a practice is this?"

They were indeed misled

Sylvia is right. They were misled, and with Sylvia on the line, I confirmed it by speaking with the on-duty manager at the store, asking her, "Do you have a charity campaign for St. Jude?"

"Yes, we do."

"Do your cashiers tell customers that 'rounding up' their total means that their change goes to St. Jude? Or do they just say, 'Would you like to round it up?'"

She refused to answer but insisted that Sylvia tell her who the cashier was. "Give me the register number on the receipt."

I repeated my question, which she still didn't answer. I took her refusal as an admission that, yes, cashiers ask customers if they want to round up their total without letting them know where their money will go.

Of course, who can forget the past few years of constantly being bombarded with "Would you like to give a dollar to XYZ organization?"

But we don't hear that much anymore, because "checkout charity" has been replaced with the "round it up" verbiage.

Perfect example of impulse giving

America is a generous nation. If you look at the Charities Aid Foundation's World Giving Index, the United States ranks near the top of countries whose citizens are among the most generous on the planet.

Now, there is giving when you know where your gift is going and you want to donate, but snookering us to give even a few cents to an unidentified cause is more than not acceptable. It is generally considered illegal to solicit charitable donations without revealing the name of the charity and the purpose for which the funds are being raised.

Both federal and state laws require transparency in charitable solicitations to protect the public from fraud.

And when it happens at the checkout counter, the customer has only seconds to decide.

In any other business or commercial setting, we would say, "Wait a minute, I have some questions."

But when people waiting behind us in line are close enough to hear our conversation with the cashier, the result is pressure — you are being pressured to give your money (i.e., make a buying decision with no time to think it over) to an organization that might not have been identified.

After asking if you'd like to donate, the cashier should say, "And your donation goes to XYZ."

But that's not always so, according to the 2025 Charity Checkout Champions Report by Engage for Good and presented by Adyen, which analyzed 92 point-of-sale (POS) fundraising campaigns that raised over $275 million in 2024. The report found that only 74% of the campaigns clearly identified the benefiting charity.

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I spoke to an executive of one of the North American companies that helps businesses collect donations for charities at checkout. He asked that he and his employer not be identified because the information he shared with me is more frank than his employer would prefer. Once I promised not to share his identity, he was quick to admit:

"We show cashiers how to seize on a customer's psychologically weak moment, when their donation could be going to a group they might not approve of and would never give their money to.

"But impulse giving is huge in the charity business, and so your very presence in the checkout line lends itself to being pressured into making a split-second decision for an altruistic reason.

"Unless full disclosure is made about the recipient of the donation, this is highly unethical, but (businesses get) away with it all the time."

Findings on impulse giving

Fifty-three percent of Americans donate impulsively at the checkout counter, according to a 2024 survey conducted by researchers Lauren Dula of Binghamton University and Ruth Hansen of the University of Wisconsin-Whitewater. They found:

• Impulse giving is often driven by social pressure, emotional appeal and the ease of the transaction.
• The donation request is embedded in a moment of financial exchange, making it feel like a small, convenient act of generosity.
• Many consumers report feeling guilty or obligated when prompted, especially in face-to-face retail settings.
• Younger customers are more likely to give impulsively than older people.

What businesses should do

The executive I spoke with offered these suggestions to help retailers that adopt checkout-charity programs do everything correctly and steer clear of trouble:

1. Name and describe the charitable organization.

• The name and purpose of the charity should be clearly displayed at the checkout
• You should verify that it is recognized by the IRS as a 501(c)(3) nonprofit

2. Provide an explanation for how customers' funds will be used.

• Include administrative or processing fees
• Break down how much goes directly to the cause

3. Ensure funds are given voluntarily and that informed consent is obtained.

• Your workers should make it clear that the donation is optional
• Customers should be told that they can decline
• Your workers should not use language that invokes pressure or guilt

The executive concluded our interview with these cautionary words for retail businesses: "Checkout charity is highly effective, and at the same time, we are hearing more and more objections to the pressure to donate. My fear is this has the potential to backfire one day."

All that said, checkout charity isn't a bad thing when it's done right. According to a Charity Watch blog, checkout donations allow charities, especially smaller ones, to raise significant amounts of money from a much larger pool of donors than they could normally reach. And because the process is part of a transaction that's already being conducted, the fundraising expenses are much lower.

So the bottom line here is that shoppers should make sure that they are aware of what they're donating to before they hand over even a small donation at the checkout. Here's what you can do if you encounter a request to round up your total:

• If the cashier isn't clear about what the money will be used for, ask.
• Don't hesitate to ask further questions about the charity. Maybe it's one you'd be happy to support.
• If you're not interested or feel there isn't enough information available, simply and politely say, "No, thank you" or "Not today."

Dennis Beaver practices law in Bakersfield, Calif., and welcomes comments and questions from readers, which may be faxed to (661) 323-7993, or e-mailed to Lagombeaver1@gmail.com. And be sure to visit dennisbeaver.com.

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As Giving Season fast approaches, advisers are gearing up for familiar conversations around philanthropy, taxes and year-end planning.

Many now include donor-advised funds (DAFs), one of the most flexible and tax-efficient charitable planning tools. DAFs allow donors to contribute assets, secure an immediate deduction, invest contributions tax-free and recommend grants over time.

Beyond their simplicity, DAFs offer advisers a powerful toolkit for navigating complex financial situations. They become especially valuable during periods of appreciated asset growth and as part of long-term wealth and estate planning.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

For advisers, Giving Season provides an ideal opportunity to surface these benefits and help clients approach generosity with intention and tax efficiency.

Below are three tax-smart strategies — plus several year-end considerations — that can help maximize both philanthropic impact and client financial outcomes.

1. Take tax deductions in the years when they matter most

A core benefit of a DAF is the ability to decouple when clients receive a tax deduction from when they ultimately choose the charities they want to support.

This is especially effective for individuals with fluctuating income — such as business owners, executives with equity compensation or anyone realizing a sizable gain from selling a home or business.

In high-income years, clients can "front-load" charitable contributions into a DAF and capture the full deduction immediately, even if they're not ready to commit to specific organizations.

For example, a client might contribute $100,000 in a high-income year but plan to grant only $20,000 right away.

A DAF lets them take the full deduction now, invest the remaining balance tax-free and take time to research charities that align with their values and giving philosophy.

This approach not only smooths charitable planning during complex financial years but also allows clients to make more intentional, well-researched granting decisions — without sacrificing the tax advantages of acting promptly.

2. Reduce capital gains exposure by donating appreciated assets

One of the most powerful ways clients can support charitable causes — and improve tax efficiency — is by donating long-term appreciated assets instead of cash.

By contributing long-term appreciated assets, clients capture the full appreciated value without triggering capital gains and can deduct the asset's fair market value, boosting the overall tax benefit.

Charities often lack the infrastructure to process complex asset gifts efficiently. DAFs, however, are designed to handle appreciated securities and even illiquid assets such as private company stock, cryptocurrency or real estate.

That means advisers can help clients unlock tax savings while giving nonprofits the ultimate benefit of a simple cash grant.

For clients with sizable estates or multigenerational legacy goals, DAFs can also help manage estate tax exposure. Assets contributed to a DAF are removed from the donor's taxable estate, offering a philanthropic tool that doubles as a long-term planning mechanism.

3. Use 'bunching' to maximize deductions under higher standard deduction thresholds

With today's higher standard deduction thresholds, many taxpayers no longer itemize annually. DAFs create an effective workaround through "bunching" — consolidating multiple years of charitable contributions into a single year.

For example, a client might contribute two or three years' worth of donations to their DAF in one tax year, itemize that year to capture a larger deduction and then take the standard deduction in subsequent years while continuing to make grants from the DAF.

For clients on the cusp of itemizing, this approach can generate meaningful tax savings without altering their charitable goals.

Here are some additional year-end DAF strategies advisers should consider:

Align giving with strategic goals, not just year-end deadlines. DAFs also give clients flexibility, whether through recurring grants, setting aside capital for future needs or aligning giving with long-term goals.

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Match contributions to income volatility. For clients with highly variable earnings, DAF contributions can be "dialed up" in high-income years and "dialed down" during leaner ones, smoothing tax exposure while allowing giving to remain consistent.

Incorporate legacy planning. Encouraging clients to discuss the charitable legacy they hope to leave — whether through successor advisers on a DAF or by making the DAF a beneficiary in their estate plan — can deepen relationships and strengthen multigenerational planning conversations.

The bottom line for advisers this Giving Season

As philanthropy becomes a more integral part of wealth planning, advisers have a meaningful opportunity to expand the conversation beyond generosity alone.

One of the often-underappreciated advantages of a DAF is that advisers can continue managing the assets contributed to the account, investing them for potential tax-free growth while maintaining their advisory role. This strengthens the client relationship and ensures charitable dollars can grow before being granted.

Combined with the tax efficiency, flexibility and long-term planning benefits DAFs already provide, this investment management capability positions them as a powerful tool — especially during Giving Season, when clients are looking to make an impact and optimize their year-end financial strategy.

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A growing number of women inheriting wealth are redefining philanthropy.

Rather than focusing on luxury or one-time donations, many are channeling their resources into lasting, purpose-driven movements that can shape communities for generations.

One powerful example is Alice L. Walton, the richest woman in the world, who recently opened her own medical school and is covering tuition for its first five graduating classes, as reported by Time magazine.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

Walton's $154 million investment in Bentonville, Arkansas, reimagines medical education by focusing on preventive health, holistic wellness and the principle that doctors must learn to heal themselves before they can heal others.

Her vision exemplifies how today's women of wealth are shifting from traditional philanthropy to creating sustainable systems to fund philanthropic gifts into perpetuity.

A strategic and generous model of giving

This new model of giving is not just generous, it's strategic. It's reshaping how ultra-affluent women think about wealth management and legacy.

To facilitate this movement, many are turning to family offices and multifamily offices to help them transform legacy into meaningful impact.

This CFO-type relationship enables women to focus on enabling significant change rather than managing their daily financial complexities.

Women of wealth today expect far more than traditional portfolio oversight. They seek solutions that align wealth with purpose, impact and legacy.

According to HSBC's 2025 report The Giving Shift, 60% of female respondents said financial giving is extremely or very important, prioritizing causes tied to family, health and community over status or prestige.

This values-based approach underscores how women use wealth to strengthen connections and drive measurable impact.

This evolution extends to how women choose their wealth managers.

A 2024 New York Life survey found that 48% of women feel more understood by a female adviser, up from 29% just five years earlier, and nearly half value collaborative, educational relationships.

They're not seeking transactions; they're seeking strategic partners.

How the family office model delivers

The family office model delivers this by providing detailed and timely financial analysis to address all the complexities of multigenerational wealth — tax, estate and philanthropy.

This clarity provides the time and ability for these women to pursue their passions.

Unlike traditional firms with standardized offerings, family offices are designed to be nimble to the complexity of clients' entire lives.

The timing of this shift is significant, as the Great Wealth Transfer has begun. Bank of America Institute's Women and Wealth report projected that roughly $54 trillion will pass to surviving spouses, 95% of whom are women.

Concurrently, Deloitte's Global Family Office Report provides insight that there are more than 8,000 single-family offices worldwide, up from approximately 6,000 in 2019. That figure is projected to increase by 75% or exceed 10,000 by the end of the decade.

A powerful truth

Together, these trends reveal a powerful truth: The next generation of female-led wealth is redefining stewardship. For women, that stewardship often centers on three main pillars:

• Wealth preservation and growth
• Family mission
• Next-generation education

The first priority is the security and growth of wealth throughout future generations with proper entity structure and risk management. The family's mission channels resources toward philanthropic causes that support family values and beliefs.

Family wealth counseling prepares children and grandchildren not only to inherit wealth, but to continue the stewardship in perpetuity.

Family offices help support these pillars by turning intention into an actionable plan of execution, helping to ensure a successful outcome of the long-term family strategy.

One example includes coordinating a charitable giving strategy with an income tax event in the same year. Within the Great Wealth Transfer, a significant portion of assets will come from qualified retirement plans.

Non-spouse beneficiaries of these plans are required to take mandatory annual distributions and must fully withdraw all assets within 10 years of the original account owner's passing.

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Because these distributions are taxed as ordinary income, working with a family office that understands your entire financial situation is essential. This coordination enables proactive tax bracket management and the use of charitable deductions to offset income, supporting both tax efficiency and the family's broader legacy objectives.

Documentation is critical

Another example is the structure and organization a family office provides when navigating complex, multigenerational strategies — particularly those involving estate exemptions and the transfer of assets to the second and third generations.

Many of these plans evolve over decades, making documentation vital. Tools such as our proprietary Family Legacy Book^® serve as a central record of gifting history, ownership structures and entity relationships.

This living road map ensures that if the matriarch or patriarch passes unexpectedly, the family retains a clear and current financial picture, providing continuity, confidence and peace of mind.

These examples reflect a broader movement among affluent women leveraging wealth with intentionality.

Increasingly, they recognize that family offices don't just preserve capital, they simplify complexity, saving them time and allowing them to focus on what truly matters: health, family purpose, personal passions and family legacy.

Beginning with the end in mind

For women of wealth, the takeaway is clear: Building a lasting legacy begins with the end in mind. Rather than chasing returns, they build the management around meeting their targeted objectives, incorporating investments, trusts, philanthropy and education under one coordinated strategy.

A well-run family office makes this possible, serving as the hub that turns intention into successful outcomes.

Start by defining what you want your wealth to accomplish, whether that's long-term stability, meaningful philanthropy or empowering the next generation with financial confidence. Surround yourself with professionals who listen, educate and collaborate.

True stewardship isn't about managing assets; it's about ensuring your wealth continues to advance family values and the future vision across generations.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

For many families, the holiday season comes with familiar rituals: untangling last year's Christmas lights, decorating the tree and rediscovering ornaments we swore we'd organize "better next year."

Charitable giving should feel just as joyful and natural — but for many households, it's also a moment when good intentions collide with inefficient habits.

The biggest habit that needs a rethink? Donating cash when there are far better options.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

This year, with markets up and many investors holding appreciated securities, writing a check could be one of the least efficient ways to support your favorite causes.

The good news: With a little planning, you can stretch your generosity and reduce your tax bill.

Why Americans give — and why it matters now

Americans are remarkably generous people.

Whether it's supporting a food pantry, helping a local family in need or giving through a workplace program, most of us want to help — especially during the holidays.

Giving truly feeds our sense of purpose: The latest Bank of America Study of Philanthropy reports that 87% of affluent donors say charitable giving brings them joy.

But with inflation still squeezing households and many nonprofits seeing higher demand this year, the way you give matters. Advisers are urging clients not just to give — but to give smart.

Donating appreciated securities: The most powerful (and overlooked) tool

For many families, the most effective giving tool is also the simplest: donating appreciated stocks, ETFs, mutual funds, even cryptocurrency — instead of cash. Yet, most people overlook it.

When you donate long-term appreciated assets (held more than a year), you get two benefits at once:

• A charitable deduction for the full market value
• Complete elimination of capital gains tax

That combination is hard to beat.

A real-life example

Say you bought $10,000 worth of a stock 15 years ago that's now worth $50,000.If you sold it, you'd owe capital gains taxes on the $40,000 of growth.

If you donate the shares directly:

• You eliminate the entire $40,000 gain from taxation
• You receive a deduction for the full $50,000
• The charity gets the whole $50,000 — not a reduced after-tax amount

Financial adviser Keith Spencer, founder of Spencer Financial Planning in Spokane, Washington, often walks clients through this exact scenario.

"If the client wants to maintain the position," he says, "they can donate the shares and immediately repurchase them. The reset cost basis may significantly reduce long-term tax liability."

This "resetting" of cost basis is a hidden gem: It starts future gains at a higher level, trimming long-term tax drag in your taxable account.

A great fit for real-world portfolios

Many households already own perfect candidates for gifting:

• Old mutual funds with large gains
• Company stock from long careers
• ETFs bought during early-pandemic dips
• Automatic dividend reinvestment shares
• A handful of big winners in an otherwise diversified account

Even donating $1,000 of appreciated securities can be more efficient than donating $1,000 of cash.

Bonus: It helps rebalance your portfolio

If one stock or sector, such as technology, has grown too large, donating appreciated shares is a painless way to trim an overweight position — without triggering capital gains.

It's the charitable equivalent of replacing that one broken string of holiday lights: a small fix that makes everything else work better.

Meet the donor-advised fund (DAF)

For many families, the easiest way to combine tax benefits, flexibility and long-term planning is a donor-advised fund.

A DAF works like a "giving account" for your charitable life — you contribute now (cash or appreciated securities), take the deduction right away, and recommend grants over time.

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The biggest DAFs are Fidelity Charitable, DAFgiving360 (formerly Schwab Charitable) and Vanguard Charitable.

According to Ted Hart, author of The DAF Revolution, here are the reasons people use DAFs:

• Flexible and strategic. Contribute now, give later and time tax deductions to high-income years.
• Simple, One contribution can support many charities; the sponsor handles verification and paperwork.
• Accessible. Many DAFs have low or no minimums, opening the door to mass-affluent donors.
• Family-friendly. A natural tool for teaching kids and grandkids about giving and values.
• Powerful tax benefits. Immediate deduction plus tax-free growth inside the account.

Who uses DAFs?

With roughly 1.5 million to 2 million accounts in the U.S., DAFs are thriving across:

• Middle-income households
• Mass-affluent families
• Workplace-giving participants
• Corporate teams
• Community and faith-based donors

David Johnston, CFP®, partner and wealth management adviser at One Point BFG Wealth Partners, and based in Flemington, New Jersey, has seen DAFs reshape how families engage with philanthropy.

"DAFs are a very powerful tool for those who want the tax deduction today but also want to control the assets over time," he says. "Some of our clients involve their family in deciding where donations go. It's a great way to teach the values of philanthropy."

Five reasons to donate stock instead of cash

1. Bigger impact, same gift. Your charity receives the full market value — not an after-tax amount.

2. Eliminate capital gains tax. Avoid taxes on appreciated assets you donate directly.

3. Increase your tax deduction. Claim the full fair-market value of the stock or fund.

4. Keep your portfolio healthy. Reduce concentrated positions without triggering taxes.

5. Pair with a DAF for maximum flexibility. Fund your DAF with appreciated shares and give over time — on your schedule.

Why this matters now

The holidays are busy. Between decorating the tree, hosting family, shopping and trying to figure out why last year's wreath looks slightly more lopsided this season, charitable giving can feel rushed.

But a little planning — especially around appreciated assets and DAFs — can turn your holiday generosity into a smarter, more meaningful gift.

The bottom line

Giving generously is part of who we are. But giving smarter helps you support more causes, involve your family in meaningful conversations and reduce your long-term tax burden.

As a retirement coach at RetireMentors, I help clients understand the meaning of money in their lives — and for many retirees, that includes finding the right nonprofits to support, volunteer with, and champion.

Just because you're retired doesn't mean you want to stop giving. Many retirees find themselves wanting to give more, to deepen their impact and to make philanthropy part of their legacy.

With a few simple strategies — such as donating appreciated securities and using a DAF — you can do exactly that.

Related Content

• How the One Big Beautiful Bill Will Change Charitable Giving
• Developing a Charitable Giving Strategy: Where to Begin
• Seven Moves for High-Net-Worth People to Make Before End of 2025, From a Financial Planner
• How Baby Boomers and Gen Xers Are Redefining Retirement Living
• I'm a Retirement Coach: Eight Surprising Signs You're Ready to Retire

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

As holiday giving season kicks into high gear, donors face a charitable landscape that is significantly different from the one they navigated a year ago, following passage of the One Big Beautiful Bill (OBBB).

What's new? Making charitable contributions just got a little easier — but also a little harder. It's a mixed bag, and donor education is critical, with some changes already in effect for the 2025 tax year, and others set to begin January 1.

Generally, those who itemize and make charitable contributions might want to accelerate some donations to make them before the end of this year to maximize their effectiveness. There are several reasons.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

It's worth noting that diminished federal grant funding to charities this year has left an unmet need within the budgets of many nonprofits.

Luckily, asset prices are relatively healthy, making conditions ripe for a generous giving season when it's needed the most.

Less reason to itemize and a new deduction

Except for two brief periods (from 1982 through 1986 and again from 2020 through 2021), charitable contributions have been tax-deductible only as an itemized deduction.

Prior to 2018, itemizing was common: The standard deduction was relatively modest, and state income taxes were fully deductible for federal purposes, resulting in almost a third of all taxpayers being itemizers.

In 2018, the standard deduction was greatly increased, and many itemized deductions were reduced or eliminated, with the result that fewer taxpayers were able to benefit from itemizing. By 2022, less than 10% of taxpayers were itemizing.

Starting in 2026, the OBBB adds a new above-the-line deduction for charitable contributions made by non-itemizers, capped at $1,000 per year for individuals and $2,000 for married couples filing jointly.

This means that non-itemizing taxpayers can enjoy a tax deduction for at least part of their charitable contributions.

On the flip side, also beginning in 2026, taxpayers who itemize will find that their charitable contributions are limited by a "floor" consisting of 0.5% of the adjusted gross income (AGI) on the return.

For example, if your AGI is $100,000, you're entitled to a charitable contribution deduction only to the extent your contributions exceed $500 in the aggregate.

In other words, a taxpayer who itemizes and has $100,000 in AGI doesn't get any deduction for their first $500 of charitable contributions.

This limitation is applied in the aggregate, not per charity, so the overall charitable deduction in this example is reduced by $500, not each separate donation.

It's important to note that the above-the-line and floor changes are independent of each other. If you don't itemize, the new above-the-line deduction applies, and the floor is not applicable; if you itemize, it's the opposite.

Beginning in 2027, taxpayers who make donations to certain scholarship-granting organizations that provide scholarships to K-12 students will be entitled to a tax credit rather than a deduction.

A tax credit is more valuable because it directly reduces your tax rather than just the amount of income on which you're taxed.

More limits on itemized deductions

There are other important changes that affect charitable giving. For example, there's an important limitation on itemized deductions for taxpayers in the 37% marginal income tax bracket (single taxpayers with $626,350 and higher and married/joint filers with $751,600 and higher in taxable income in 2026).

Usually, an income tax deduction is "worth" the amount of the deduction multiplied by your marginal rate.

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In other words, if you're in the 24% marginal tax bracket, each $100 deduction reduces your tax by $24.

Starting in 2026, this will remain true for taxpayers in all the marginal brackets except those in the 37% bracket; taxpayers in that bracket will have all or a portion of their itemized deductions reduced by 2%.

As a result, a $100 deduction will be worth only a maximum of $35.

SALT going back up to $40,000 should drive more itemizing

In the other direction, the limitation on the state and local tax (SALT) deduction for itemizers is going up by $30,000 (to a total of $40,000), though it phases out for higher earners. This change is already in effect for the 2025 tax year.

The more meager limit had significantly reduced the number of taxpayers who would benefit from itemizing. Now it might make more sense for those taxpayers to itemize and take advantage of the higher charitable contribution deductions available to those who do.

The bottom line: Bunching

Going forward, we might see more of the bunching strategy to maximize the reach of charitable contributions.

For example, suppose a taxpayer with a yearly AGI of $200,000 normally makes $10,000 in charitable contributions each year. Due to the 0.5% floor, a contribution of $10,000 in 2026 and 2027 will result in a deduction of only $9,000 each year, or a total of $18,000 for the two years.

However, if that taxpayer makes two years' worth of contributions in one of those years and skips the other, the total contribution of $20,000 is only reduced by $1,000, and the total deduction is $19,000.

Depending on the specific situation of the taxpayer, this could be combined with a strategy of not itemizing at all in the "off" years and taking the $2,000/$1,000 above-the-line deduction in those years, further leveraging the amount of tax-favored money going to charity.

All in all, OBBB will transform the landscape of tax-advantaged giving. It has benefits as well as drawbacks to donors, and proper planning will be essential to making sure your gifts go the longest way possible.

Related Content

• One Big Beautiful Bill, One Big Question: Will We Keep Giving?
• Five Ways to Adapt Your Charitable Giving Strategy in a Changing World: An Expert Guide
• 3 Ways High-Income Earners Can Maximize Their Charitable Donations in 2025
• How Charitable Donations Can Reduce Your Taxes
• Revocable Living Trusts: The Good, the Bad and the Ugly

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

With the giving season officially underway, December 31 marks your critical tax deadline for charitable giving. About 30% of annual gifts occur before year-end, making this the prime time for taxpayers to maximize their 2025 itemized charitable donations tax deduction.

And for high-income earners, charitable giving in 2025 is particularly vital. Tax legislation in 2026 will cap the maximum federal tax benefit at 35%, effectively making contributions this year far more valuable. Plus, a new rule next year will further reduce the allowable charitable deductions for donors over a certain floor limit.

Here’s what you need to know.

Related: The 'Scrooge' Strategy: How to Turn Old Junk Into a Tax Deduction

Charitable deduction for high-income earners in 2025

Let’s first review why donating this year, in 2025, is more advantageous than in 2026. Basically, the 2025 Trump Tax Bill changed several rules regarding charitable donations. A couple of those changes affecting high earners are summarized in the following table.

As you can see, for 2026, a charitable contribution "floor" will be introduced for itemizers, regardless of income level. Only total contributions above 0.5% of your AGI will be deductible.

For example, if you had $200,000 AGI and donated $2,000, only $1,000 would be deductible.

Charitable contributions for high-income itemizers will also be subject to a cap in 2026. The new law imposes a 35% limit on the value of all itemized deductions for high earners, meaning taxpayers in the top bracket will receive a lower tax break compared to 2025.

While excess contributions can still be carried forward for up to five years, carryforwards used in 2026 and beyond will be subject to the new limitations.

So below are three ways for you to take advantage of the more advantageous donation rules in 2025 — especially if you’re a high earner.

1. Donate stock to charity (or other appreciated non-cash assets)

You may have heard that donating appreciated stock (or other non-cash assets) is a part of a good charitable deduction strategy. Well, that’s because donating these assets provides a “double” tax benefit.

• You can deduct the asset’s full fair market value, pre-tax. If your asset’s fair market value (FMV) is higher than “cost-basis” (what you paid), the gain is not taxable once donated to a qualified, public charity.
• This allows you to avoid capital gains tax. By transferring the asset directly to your chosen charity, you’ll avoid paying capital gains tax (up to 20%) on the increase in the asset’s value. Plus, you may also avoid paying the 3.8% net investment income tax (NIIT).

Of course, there are a couple of caveats when donating appreciated non-cash assets.

• Namely, the donated asset must have been held for more than one year before donation; otherwise, the asset will be donated at cost-basis, which could be significantly lower than the value of an appreciated stock.
• Also, donations of appreciated stock to a public charity are subject to a 30% AGI limit, which is higher than the AGI limit for cash (60%). Despite this difference, avoiding capital gains tax typically makes donating the asset (rather than selling and donating the cash) more tax-advantageous.

If you donate appreciated assets to specific types of accounts, your donations may also yield tax-free growth for future charitable giving. One such account that high-earners typically use is a donor-advised fund (DAF).

2. Use a donor-advised fund (DAF) bunching tax strategy

A donor-advised fund (DAF) allows you to claim an immediate tax deduction for your contributions this year (under the more favorable 2025 rules), while the fund recommends grants to your chosen charities over time.

Given the flexibility in timing, a DAF is often used in conjunction with a tax strategy called “bunching.” This is where you pay two or more years’ worth of itemized expenses in the current tax year to push your total itemized deductions over the standard deduction amount.

• If performed correctly, “bunching” your deductions gives you one year of high itemization followed by one year of the standard deduction, which maximizes your total tax savings for both years.
• Using a DAF-bunching strategy is particularly beneficial for high-income earners who anticipate a higher federal income tax rate in 2026, when charitable giving tax laws will be less favorable.
• Plus, tax-free growth in a DAF means you can pay out more money in the future, amplifying your philanthropic impact.

Also, bunching doesn’t just exist for charitable deductions. You can front-load other popular itemized deductions, like the state and local (SALT) deduction, the medical expense deduction, and even the mortgage interest deduction, to help push your deduction amount higher than the standard. Yet keep in mind that certain AGI limits and other IRS rules may apply to each itemized deduction.

3. Make a charitable IRA distribution (QCD)

A qualified charitable distribution (QCD) is a distribution from your IRA to a qualified charity of your choice. QCDs are particularly beneficial if you’re trying to avoid taking your required minimum distribution (RMD) and still want to meet your charitable giving goals for the year.

Here are the eligibility requirements for 2025:

• You must be age 70 ½ or older.
• You can donate up to $108,000 (or $216,000 if married spouses) in a single tax year.
• The distribution must be made from a traditional IRA, an inherited IRA, or an inactive SEP/SIMPLE IRA.

Although QCDs require that you “give up” a portion of your annual IRA distribution to a charity, that amount is excluded from your AGI.

This lower AGI may reduce your taxable income, thereby lowering your tax on Social Security benefits for the current year. Even better, reducing your AGI helps lower your income for the Medicare premium calculation two years later, potentially allowing you to avoid higher premiums.

But a QCD doesn’t qualify as an itemized “charitable deduction” on your income taxes, which may hamper your bunching strategy. You also can’t use a DAF to make a QCD, so be sure to review your complete charitable giving strategy before making one.

Changes to charitable donations in 2026

While we covered several notable ways to maximize your gifting strategy in 2025 if you’re a high-income earner, here are a couple of other gift tax changes going into effect in 2026:

• Increased estate tax exclusion. While the basic exclusion amount for individuals was $13.99 in 2025, the exclusion was increased to $15 million in 2026. This may affect your gifting strategy as a higher exclusion amount allows individuals to transfer more wealth to heirs estate tax-free.
• New non-itemizer charitable deduction. A federal deduction for non-itemizers up to $1,000 for single filers (or $2,000 for joint filers) will be available in 2026. However, you can’t use this deduction in conjunction with DAF or private foundations.

Of course, these changes may not affect everyone, depending on your gifting strategy. Also, state tax rules may differ. Consult with a qualified tax professional to discuss which tax strategies are best for your financial circumstances.

Read More

• 10 Retirement Tax Plan Moves to Make Before Year-End
• What is the Gift Tax Exclusion for 2025 and 2026?
• 2025 Roth Conversion Strategy: 6 Reasons to Convert (& When Not to)
• How Charitable Donations Can Reduce Your Taxes
• 3 Major Changes to the Charitable Deduction in 2026

As 2025 winds down, you may soon be finalizing your charitable-giving plans for the year. Many causes need funding, from relief efforts following natural disasters to humanitarian aid initiatives in countries ravaged by conflict and political instability. By donating to reputable organizations, you can support them as they provide vital resources, research and programs.

But deciding which charities most deserve your dollars can be overwhelming. With so many worthy causes to consider, it pays to put some thought into which ones best align with your values and to research which organizations are likely to make the best use of your donations. Along with taking advantage of tax-savvy ways to give, such as contributing to a donor-advised fund or making qualified charitable distributions from an IRA, creating a budget and a schedule for giving throughout the year can help maximize your impact.

Below, we have guidance on setting up a solid giving strategy. And if you're looking for ideas for organizations where you can direct your donations, check out our list of some top-rated charities in a variety of categories.

Do some soul-searching

Start by narrowing down the types of causes you'd like to support, reflecting on the issues that matter to you most.

"I always suggest that people do a value exercise," says Colby Bircher, vice president of philanthropic strategies for donor-advised fund Fidelity Charitable. Consider bringing your children into the conversation, too. "If you want to engage the next generation in your philanthropy, you can all come up with collective shared values among the family to really help drive forth what's important to you and how you want to support that giving."

A few questions to consider: Which causes inspire you? Which populations or groups might you want to focus on, and where are they? What are you looking to accomplish with your support?

Once you've answered those questions, learn more about the issues that you care about and how charities can most effectively influence them. You might read research from foundations that specialize in an issue, attend events related to it or speak with experts, such as representatives from a charity that focuses on the issue.

Think about how you'd like a nonprofit to put your donations to work. You may want to help fund research — say, for treating Alzheimer's disease or ensuring clean drinking water. Or you may prefer to focus on organizations that advocate for policy change or that provide direct services, such as emergency aid following a disaster.

Another approach is to donate to efforts that tackle the root causes of a particular issue rather than the issue itself, says Theresa Schieber, vice president of advisory for Rockefeller Philanthropy Advisors. This method of focusing on "systems change" may manifest as supporting education, economic opportunity and access to jobs as a means of tackling homelessness, for example, rather than developing more shelters and housing.

"A systems-change approach allows you to use a much bigger lens with a particular challenge," says Schieber.

Set your donation budget

While year's end is the high season for giving, you may want to contemplate a strategy for your charitable donations in 2026 and beyond, too. Spreading your donations throughout the year (say, on a monthly or quarterly basis) rather than waiting until the end of the year, when your budget may be squeezed by holiday expenses, can help ensure that you meet your giving goals.

A steady flow of donations during the year can be helpful for charities, too — especially causes that have faded from the headlines but still need ongoing support, from the wildfires that swept through Los Angeles early this year to the flooding that struck Texas Hill Country over the summer.

Plus, if you take the standard deduction on your tax return, you may have good reason to shift some of the contributions you'd ordinarily make by the end of this year to 2026, thanks to changes in the One Big Beautiful Bill Act, signed into law over the summer. Starting in 2026, taxpayers who don't itemize can deduct up to $1,000 in charitable contributions, or up to $2,000 for married couples who file jointly. For the 2025 tax year, however, you don't get a deduction for charitable contributions if you don't itemize.

As you make a plan, consider setting short- and long-term goals for the amount of money you want donate and the frequency at which you'd like to give. You might plan to donate $250 per month over the next two years, for instance, and then aim to increase your monthly giving by 50%, to $375, for the two years following that. To maximize the impact of your donations, check whether your employer has a gift-matching program, which matches your donations dollar-for-dollar up to a specified limit.

Think about how you'll divvy up your donations, too. A good general guideline is the 80-20 rule, says Bircher, of Fidelity Charitable: "80% of your giving goes to an area that aligns well with your charitable mission, and 20% is reserved to giving more responsively."

In other words, you could set aside the bulk of your giving budget for your core strategy and a smaller portion for, say, donating to fundraisers that family members and friends ask you to support or providing aid after a natural disaster or when another sudden need arises.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

Related Content

• How the One Big Beautiful Bill Will Change Charitable Giving
• Three Veterans Charities to Support As Charitable Season Starts
• Five Ways to Maximize Your End-of-Year Philanthropy

As giving season gets underway, you may be wondering how to contribute this year. Will you give the gift of your time on Giving Tuesday, which this year falls on December 2, or donate funds to a worthy cause, reaping tax benefits as you do so?

With around 1.8 million nonprofits in the U.S. vying for donations, it's can be hard to choose where to direct your cash for maximum impact. One sector you may have overlooked before now is support for veterans and their families.

Men and women who've served in the armed forces experience post-traumatic stress disorder (PTSD), financial strain and homelessness at a higher rate than the general population. If you wish to help, consider donating to these top-rated organizations that support those who served in the military.

A note on donating with confidence

Donating money is easier when you're safe in the knowledge it will be used effectively and make a real difference to people's lives. The organizations listed below have received an A rating from CharityWatch — a group that rates charities based on their financial efficiency and other factors — and a score of 90% or higher from charity evaluating service Charity Navigator, which means they exceed or meet best practices and industry standards across almost all areas.

Homes for Our Troops

Homes for Our Troops (HFOT) builds and donates specially adapted homes for severely injured post-9/11 veterans. With 69 projects recently under way nationwide, HFOT has built 417 homes for severely injured veterans across the country.

CharityWatch: A
Charity Navigator: 98%

Iraq and Afghanistan Veterans of America

Iraq and Afghanistan Veterans of America advocates for and supports post-9/11 veterans through policy initiatives, community building, and access to mental health and transition resources.

Since its start 20 years ago, the IAVA has fought to win passage of various legislation that supports vet­erans, including the Post-9/11 GI Bill, which expanded education benefits for veterans; the Deborah Sampson Act, which improved services for women veterans; and the PACT Act, which increased access to care for veterans exposed to toxic burn pits and other hazardous substances.

CharityWatch: A–
Charity Navigator: 100%

Semper Fi & America's Fund

Semper Fi & America's Fund supports critically wounded, ill and injured service members, veterans and their families. The organization provides immediate financial assistance as well as ongoing services, such as help with career transitions.

It processes, on average, 170 grant requests each day, typically delivering assistance within 24 to 48 hours of receiving an emergency request, and within a week for nonurgent cases.

CharityWatch: A+
Charity Navigator: 100%

Related content

• Six Steps to Plan Your Charitable Giving
• Ways to Optimize Your Charitable Giving Before Year-End
• Charitable Contributions: Five Frequently Asked Questions

For many affluent families, the end of the year brings more than holiday traditions and travel. It's also one of the most critical windows for financial planning.

When done right, year-end planning can reduce taxes, align finances with family goals and set the stage for greater confidence heading into the new year.

Year-end planning shouldn't be seen as a scramble for last-minute tax breaks. Instead, planning is most effective when it's proactive, tax-aware and rooted in long-term values.

Families are best served when strategies are connected to their most important goals, whether they're maximizing charitable impact, preparing for the next generation or simply confirming lifestyle stability in uncertain times.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

Here are seven moves high-net-worth families should consider before December 31.

1. Charitable giving with a donor-advised fund

A donor-advised fund (DAF) is a charitable account that lets you contribute cash or appreciated assets, take an immediate tax deduction and invest the funds to grow tax-free until you decide which charities to support.

It provides flexibility to separate the timing of your tax deduction from your actual giving, allowing for more strategic philanthropy over time.

A DAF can appeal to families focused on long-term charitable planning, particularly those facing a high-income year or a liquidity event.

In 2025, deduction limits were adjusted by the OBBBA, which means contribution plans should be reviewed carefully to ensure every dollar counts.

For those over age 70½, a qualified charitable distribution (QCD) from an IRA may be an even more efficient way to give, as it can reduce taxes on required withdrawals.

Choosing between a DAF and a QCD depends on age, income and philanthropic intent.

2. Use Roth conversions to unlock tax-free growth

A Roth conversion moves assets from a traditional IRA into a Roth IRA, creating a tax bill now in exchange for tax-free growth and withdrawals later.

This strategy is most beneficial during years of lower income, such as the period after retirement but before Social Security benefits and required minimum distributions (RMDs) begin.

The key is weighing the near-term tax hit against the long-term flexibility it provides.

Converting gradually over multiple years can help avoid large spikes in taxable income while building more predictable tax-free income streams for the future.

3. Harvest losses to manage taxes

Tax-loss harvesting may help reduce overall tax liability while keeping a portfolio aligned with long-term investment goals.

When markets have performed strongly, reviewing portfolios for losses that can be used to offset taxable gains is a prudent step.

This approach is particularly relevant after a business sale or other liquidity event that triggers significant capital gains.

In some cases, it may also make sense to spread sales across two calendar years. The goal is to manage the tax impact and take advantage of the opportunity to rebalance holdings with an eye toward future needs.

4. Do not miss retirement contribution and RMD deadlines

December 31 is the firm deadline for RMDs if you are age 73 or older and for beneficiaries with inherited IRAs. Missing this date can result in significant penalties.

It is also important to understand the different deadlines for retirement account contributions. Contributions to employer-sponsored plans such as 401(k)s must be made by December 31, 2025, to count for the 2025 tax year.

By contrast, contributions to IRAs (traditional or Roth) can be made up until the tax filing deadline of April 15, 2026.

Regardless of the deadline, year-end is the time to make sure contributions are on track. At a minimum, families should contribute enough to capture any employer match, but higher contributions may make sense depending on cash flow and tax planning goals.

Acting early and setting reminders helps avoid the year-end rush and ensures opportunities are not missed.

5. Revisit estate and gifting strategies

The OBBBA permanently made estate exemptions higher, which will be set at $15 million per person beginning in 2026. Even with these higher thresholds, year-end remains an important time to consider gifting strategies.

Families may want to take advantage of the annual gift tax exclusion, which allows $19,000 per person in 2025, enabling wealth transfer to children, grandchildren or other loved ones without dipping into lifetime exemption amounts.

While not every family will face estate taxes, intentional gifting helps reinforce family values and encourages multigenerational stewardship.

6. Review liquidity and cash flow for 2026

Looking ahead to next year's goals and expenses is an essential year-end step. Identifying upcoming needs, such as tuition payments, philanthropy or large purchases, provides the opportunity to align cash flow with tax planning.

For example, it may make sense to realize gains or take distributions in 2025 to fund 2026 expenses, especially if doing so fits within current tax brackets.

This forward-looking exercise eases stress and provides clarity, ensuring families enter the new year with a solid financial foundation.

7. Business owners and executives should plan ahead

Business owners and executives often face unique year-end decisions. Concentrated stock positions, restricted stock units (RSUs) and deferred compensation all require careful evaluation.

For executives, managing the timing of RSU sales after vesting events can help reduce tax burdens while also diversifying holdings.

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Business owners nearing retirement may want to gradually reduce exposure to their own company stock to better align assets with long-term investment goals.

Those with options to defer income must weigh the pros and cons of recognizing income now vs later. Each choice should be made in the context of long-term financial security and broader life goals.

The bigger picture

Year-end planning is not just about wrapping up 2025. It's about entering 2026 with clarity and confidence.

By taking time now to align tax strategies, gifting, savings and cash flow with long-term goals, families create the flexibility to handle both expected milestones and unexpected surprises.

Closing out the year with intention lays the groundwork for financial decisions that feel less reactive and more purposeful. A thoughtful December can make the year ahead less stressful, more strategic and ultimately more successful.

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• Energy Efficient Home Improvement Tax Credits — Get 'Em While You Can
• 12 Education Tax Credits and Deductions to Know
• Best States for Middle-Class Families Who Hate Paying Taxes

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Defining success in philanthropy depends entirely on the goals an investor is trying to achieve, whether these are social, wealth transfer, personal or tax-deductibility objectives.

With the passage of the One Big Beautiful Bill (OBBB), new tax rules and opportunities are now available to help investors reach their goals.

OBBB's key changes to charitable giving

The OBBB introduced four important changes to tax laws affecting charitable giving:

Standard deduction. Taxpayers who take the standard deduction will be able to claim a deduction for charitable contributions of up to $1,000 for single filers and $2,000 for joint filers.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

Itemized deductions. The individual deduction limit for cash contributions made to public charities is 60% of a taxpayer's adjusted gross income (AGI). This limit was previously scheduled to sunset and revert to 50% at the end of 2025, but the OBBB extends the current 60% limit.

0.5% floor. For individual taxpayers who itemize deductions, the OBBB creates a new floor of 0. 5% to be eligible to deduct charitable contributions. This means that individuals will be able to deduct only the value of charitable gifts that exceed 0.5% of their AGI — that's $500 for every $100,000 in AGI.

Deductibility cap. For itemizers, the tax law also caps the benefit of the total itemized deductions at 35 cents per dollar for taxpayers who are in the 37% tax bracket.

These changes for individual taxpayers are effective for taxable years beginning January 1, 2026.

While introducing a charitable deduction for taxpayers who don't itemize might encourage greater participation in giving, high-income taxpayers could see a reduced tax benefit from charitable deductions in the future.

In light of these changes, some donors might consider accelerating their contributions in 2025 using a donor-advised fund (DAF) to maximize the value of their contributions before the new changes go into effect.

Understanding donor-advised funds

DAFs are charitable accounts funded by individual donors but maintained and operated by a charity. Once a donor makes a contribution, the sponsoring charity is responsible for maintaining the account, investing contributions and distributing funds in line with the donor's advice.

Distributions are made whenever and to whomever the donor and the sponsoring charity direct. Unlike private foundations, which require a 5% distribution each year, the law doesn't require DAF funds to be deployed at any time.

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DAFs are treated as public charities for tax-deduction purposes; however, DAFs aren't qualified recipients of a qualified charitable distribution (QCD).

As a result, DAFs can't receive qualified distributions from retirement accounts or from nonitemizers seeking to take advantage of the new $1,000 below-the-line deduction for cash contributions.

Selecting the right DAF can be as important as selecting the eventual charitable recipients, and thanks to innovations in product development, investors have some compelling options.

For example, the recently launched Janus Henderson Charitable Investment Accounts provides a tax-deductible opportunity for investors with no account minimums, low contribution minimums, grants as low as $50, tax-free growth potential and an attractive fee structure.

The time is now

The OBBB has altered some of the rules of philanthropy, and investors should act ahead of the end of the year to secure the tax benefits provided by the new law.

This is especially true for high-income taxpayers who have an opportunity to accelerate contributions in 2025, implement a bunching or bundling strategy via a DAF and make the most of current tax regulations before they change.

To maximize deductibility and avoid application of the 0.5% floor, we believe itemizers should "prefund" charitable contributions into their charitable investment accounts this year.

A charitable gift of $5,000 made in 2025 generates a $5,000 deduction. That same $5,000 charitable gift made in $1,000 increments per year beginning in 2026 would create a total deduction of $2,500.

For a potentially better tax result, investors can "bunch" those charitable gifts into a DAF this year and make gifts to charity from the DAF in the coming five years.

As always when it comes to tax planning, investors should work with a trusted tax professional or financial adviser to create a plan that meets their values and goals.

Matthew Sommer is a Managing Director and Head of Specialist Consulting Group at Janus Henderson Investors. His team consists of various subject matter experts across several disciplines, including retirement planning, wealth advisory, practice management and investment strategies. They provide clients actionable insight and expertise they can implement into their business practice to retain and gain clients. Prior to joining Janus in 2010, Dr. Sommer spent 17 years at Morgan Stanley Wealth Management and its predecessors, Citi Global Wealth Management and Smith Barney, during which time his roles included director of financial planning and director of retirement planning.

Jeffrey R. Brooks is an Executive Director and Wealth Strategist with the Specialist Consulting Group at Janus Henderson Investors. Jeff brings to his role years of experience in both the practice of law as well as the financial services industry, working together with financial advisors and their high-net-worth and ultra-high-net-worth clients. His knowledge and real-world experience are invaluable for advisers and investors facing hurdles in the quest to achieve tax, wealth transfer, family governance, business succession and philanthropic goals.

The information contained herein is for educational purposes only, is not an account type recommendation, and should not be construed as financial, legal or tax advice.

Investing involves risk, including the possible loss of principal and fluctuation of value.

A donor-advised fund is facilitated by a tax-exempt public charity under sections 501(c)(3) and 509(a)(1) of the Internal Revenue Code. Contributions made to a donor-advised fund are considered an irrevocable gift and are not refundable. Once contributed, the charitable organization facilitating the donor-advised fund has exclusive legal control over the contributed assets.

Donors should carefully consider information contained in the prospectus, or if available, the summary prospectus, for the registered underlying mutual funds, including investment objectives, risks, charges and expenses. Donors can request a prospectus by calling Janus Henderson at 800-525-3713. Please read the prospectus carefully before making contributions.

Market fluctuations may cause the value of investment fund shares held in a donor-advised account to be worth more or less than the value of the original contribution to the funds.

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• One Big Beautiful Bill, One Big Question: Will We Keep Giving?
• Five Ways to Adapt Your Charitable Giving Strategy in a Changing World: An Expert Guide
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• Three Financial Planning Strategies for When Markets Fall

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Each week, in our Ask the Editor series, Joy Taylor, The Kiplinger Tax Letter Editor, answers questions on topics submitted by readers. This week, she’s looking at questions on the tax rules for charitable deductions. (Get a free issue of The Kiplinger Tax Letter or subscribe.)

1. How do I substantiate my write-off?

Question: I donated money to charity earlier this year, and I would like to deduct the contribution on my tax return since I will be itemizing on Schedule A of Form 1040. What documents do I need to keep to support the tax write-off?

Joy Taylor: The required documentation for substantiating a charitable contribution write-off differs based on whether you are donating property or cash and the amount of the donation. I've set forth some of the rules here. For charitable gifts of cash:

• Keep cancelled checks, electronic fund transfer receipts, credit card statements or a letter from the charity
• For cash donations of $250 or more, receipt of a contemporaneous written acknowledgment from the charity is required

For charitable gifts of property:

• A letter or receipt from the charity suffices for property donations under $250
• For property donations of $250 or more, receipt of a contemporaneous written acknowledgment from the charity is required
• Attach Form 8283 to your tax return if your property donation exceeds $500
• Obtain a written appraisal for a donation of property over $5,000

You can find more information on the substantiation rules for charitable donations in IRS Publication 526, Charitable Contributions.

2. Will the IRS audit me?

Question: I am planning on making a big donation to charity closer to year-end. Will my IRS audit odds go up because of the large charitable contribution deduction I claim on Schedule A of my 1040?

Joy Taylor: It depends. You won’t automatically be audited by the IRS for claiming big deductions on your tax return. But if your write-offs are disproportionately large when compared with the income reported on your return, your risk of an audit rises because that is a key factor in the IRS’s process of selecting returns for examination. Make sure to keep good records and to comply with the substantiation rules for charitable contributions, which you can find in IRS Publication 526 (as above).

3. What if I donate an annuity contract?

Question: I am thinking of donating an annuity contract I own to charity. Can you explain the tax consequences if I decide to do this?

Joy Taylor: You will generally be treated as receiving taxable income equal to the difference between the annuity’s cash surrender value and your investment in the contract. For example, say you have a small variable annuity in which you invested $20,000 years ago, and it’s now worth $43,000. If you donate it to charity, you’ll have to report $23,000 of the appreciation as additional income on your tax return in the year of the transfer. You will also be able to take a charitable deduction on Schedule A of Form 1040. The charitable write-off will equal the value of the annuity in most cases.

4. Any changes for next year?

Question: I heard that the “One Big Beautiful Bill” (OBBB) allows nonitemizers to deduct charitable contributions. When does this take effect?

Joy Taylor: The OBBB has mixed news for individuals who make charitable donations. Two new rules begin in 2026, meaning they will first affect your 2026 tax return that you file in 2027. First, the good news. Nonitemizers will be able to deduct up to $1,000 of their charitable cash contributions. The amount is $2,000 for joint filers.

Now, the bad news. Charitable donations claimed by itemizers on Schedule A will be subject to a haircut. Beginning with 2026 returns, the charitable write-off is deductible only to the extent that total charitable gifts exceed 0.5% of adjusted gross income. For example, say your AGI is $232,000 and you donate $14,000 to charity in 2026. If you itemize on Schedule A, you can only deduct $12,840 of charitable contributions ($14,000 – ($232,000 x 0.005)).

5. Will I owe tax if I donate I bonds?

Question: I own Series I savings bonds that have not yet matured. Can I donate the I bonds to charity before they mature and avoid a federal income tax hit?

Joy Taylor: No. Series I (and EE) bond buyers have a choice when they acquire the bonds. They can pay federal income tax each year on the interest earned or defer the tax bill to the end. Most people choose the latter. They report the interest income on their Form 1040 for the year the bonds mature (generally 30 years) or when they’re cashed in, whichever comes first.

I assume you have deferred reporting for federal income tax purposes the annual interest that you earned on the savings bonds. Gifting away EE or I bonds to someone else, including a charitable organization, before those bonds mature, doesn’t let you avoid the tax on previously untaxed interest. Instead, it will accelerate interest reporting. You will owe federal income tax on all the previously deferred interest in the year you make the donation.

About Ask the Editor, Tax Edition

Subscribers of The Kiplinger Tax Letter, The Kiplinger Letter and The Kiplinger Retirement Report can ask Joy questions about tax topics. You'll find full details of how to submit questions in each publication.
Subscribe to The Kiplinger Tax Letter, The Kiplinger Letter or The Kiplinger Retirement Report.

We have already received many questions from readers on topics related to tax changes in the OBBB and more. We will continue to answer these in future Ask the Editor round-ups. So keep those questions coming!

Not all questions submitted will be published, and some may be condensed and/or combined with other similar questions and answers, as required editorially. The answers provided by our editors and experts, in this Q&A series, are for general informational purposes only. While we take reasonable precautions to ensure we provide accurate answers to your questions, this information does not and is not intended to, constitute independent financial, legal, or tax advice. You should not act, or refrain from acting, based on any information provided in this feature. You should consult with a financial or tax advisor regarding any questions you may have in relation to the matters discussed in this article.

More Reader Questions Answered

• All Ask the Editor Q&As
• Ask the Editor: Reader Questions on QCDs
• Ask the Editor: Tax Questions on The SALT Deduction
• Ask the Editor: Questions on Four New Tax Deductions
• Ask the Editor: Questions on Inherited IRAs
• Ask the Editor: Questions on Home Sales and Taxes

The One Big Beautiful Bill Act, signed into law in July, has wide-reaching implications for taxpayers. From an enlarged standard deduction for older adults to more-generous tax credits for families with young children, the legislation contains a plethora of provisions that could lower your 2025 tax bill — or, in some cases, increase it.

Just as noteworthy as the new rules are those that extend provisions from the 2017 Tax Cuts and Jobs Act (TCJA). The OBBBA makes permanent the reductions in federal income tax rates that the TCJA implemented. (Otherwise, those tax rates would have expired on December 31.)

In addition, the OBBBA increases the federal estate tax exemption from $13.99 million per person in 2025 to $15 million per person, or $30 million for a married couple, in 2026. It will be adjusted annually for inflation.

Without congressional action, the exemption would have dropped to about $7 million after 2025. Because of the exemption’s size, the vast majority of taxpayers don’t need to worry about paying federal estate taxes.

You may want to schedule an appointment with your financial planner or tax preparer to discuss how the bill will affect your 2025 tax liability.

“You’ve got to run the numbers, because there’s so much that’s changing,” says Tim Steffen, director of advanced planning at Baird.

To get you started, we have guidance here on how to get the most from some of the significant provisions in the OBBBA.

A BONUS DEDUCTION FOR OLDER ADULTS

Starting with the 2025 tax year, taxpayers who are 65 or older will be eligible for an additional standard deduction of $6,000. The bonus deduction, which is scheduled to expire at the end of 2028, comes on top of an existing extra standard deduction of $2,000 for single filers who are 65 or older or, for married couples who file jointly, $1,600 for each spouse who is 65 or older.

The expanded deduction means a single taxpayer who is 65 or older will be able to deduct up to $23,750 from taxable income, while a married couple who file jointly will qualify for a deduction of up to $46,700, assuming both are 65 or older.

That can translate to significant savings for older taxpayers. For example, an older married couple in the 22% tax bracket (for 2025, that includes income of $96,951 to $206,700) could see tax savings of $2,640 a year, says Marilou Davido, a certified financial planner in Milwaukee.

Older taxpayers in lower tax brackets could save $600 to $1,200 a year, she says.

The legislation won’t eliminate taxes on Social Security benefits. But because the taxability of benefits is based on a calculation involving your adjusted gross income, the OBBBA will reduce the number of beneficiaries who pay the taxes from 36% to 12%, according to the White House Council of Economic Advisers.

Now for the caveats: The bonus standard deduction will affect only eligible taxpayers whose income exceeds the amount of the deduction, so low-income people won’t benefit from this tax break.

At the other end of the spectrum, higher-income taxpayers could see the amount of the bonus deduction reduced or eliminated altogether.

The deduction starts to phase out for couples with modified adjusted gross income of more than $150,000 ($75,000 for single filers) and is fully phased out at MAGI of $250,000 ($175,000 for singles). Your modified adjusted gross income is your adjusted gross income with certain deductions added back.

The higher standard deduction won’t shield Medicare beneficiaries who pay a surcharge, known as the income-related monthly adjustment amount (IRMAA), on their Part B and Part D premiums. The surcharge is based on a version of your MAGI that’s specific to Medicare and is calculated before the standard deduction applies.

Taxpayers whose MAGI is close to surpassing the eligibility threshold for the bonus standard deduction should consider avoiding moves that could reduce this tax break’s value.

For example, converting funds in a traditional IRA to a Roth IRA could reduce or eliminate the bonus deduction by increasing your MAGI, says Davido.

If you want to convert to a Roth, consider spreading out the conversions over several years to keep your MAGI below the threshold, she says.

One argument in favor of doing a Roth conversion is that it protects your nest egg from future tax increases, because Roth withdrawals are tax-free as long as you’re 59½ or older and have owned the Roth for at least five years.

But now that the OBBBA has extended current tax rates, individuals can spread out conversions without fear of a tax increase, at least under the current presidential administration, Davido says.

Timing matters, too: Converting to a Roth before age 65 would avoid the potential loss of the bonus deduction.

Capital gains distributions and withdrawals from traditional IRAs will also increase your MAGI. But there are steps you can take to offset that income and preserve the bonus deduction.

If you’re still working, increasing pretax contributions to 401(k) plans and health savings accounts (HSAs), for example, will reduce your MAGI.

Individuals who are 70½ or older can reduce their MAGI by making qualified charitable distributions from their IRAs, says Todd Calamita, a CFP in Charlotte, N.C.

In 2025, taxpayers can make QCDs of up to $108,000 from their IRAs to qualifying charities. If you’re 73 or older, a QCD will also count toward your required minimum distribution (RMD). A QCD isn’t deductible, but it’s excluded from taxable income.

Davido recommends working with your tax preparer or financial planner before year-end to adjust income-tax withholding and estimated tax payments for 2026. The bonus standard deduction could enable you to reduce the amount of tax withheld from your Social Security benefits and IRA withdrawals; you may also be able to lower your quarterly estimated tax payments.

A BIGGER BREAK FOR HOMEOWNERS

The OBBBA contains a valuable tax break for homeowners who live in high-tax states, and like the bonus standard deduction, the change could affect your 2025 tax bill.

Starting in 2025, those who itemize will be able to deduct up to $40,000 in state and local taxes (SALT), up from a cap of $10,000. The cap will increase by one percentage point each year through 2029, then return to $10,000 in 2030.

The SALT deduction includes state income, property and sales taxes; it’s often most useful for property taxes, which have soared as home values have risen in recent years. The primary beneficiaries will be homeowners in states with high property taxes, such as New Jersey and New York.

The cap is gradually reduced for those with MAGI above $500,000 ($250,000 for a married individual filing separately), and taxpayers with MAGI of $600,000 or more will be limited to deducting $10,000 on their tax returns.

Consequently, homeowners who are eligible for the higher cap need to be even more mindful of their 2025 MAGI, says Robert Keebler, a CFP with Keebler and Associates in Green Bay, Wis. This phaseout is potentially more costly than the phaseout for the bonus standard deduction, he says.

Keebler offers this example: Suppose you’re married, file jointly and have a MAGI of $500,000. Your itemized deductions include $40,000 in state and local taxes. If you convert $100,000 from a traditional IRA or 401(k) to a Roth, your gross income rises to $600,000, and your state and local tax deduction is reduced to $10,000. While your gross income went up by $100,000, your taxable income rose by $130,000.

At a 35% marginal rate, your effective rate on the conversion is 45.5%.

As is the case with older taxpayers, homeowners who are eligible for the higher SALT cap should consider spreading out Roth conversions and taking other steps to keep their MAGI below the thresholds.

Homeowners in high-tax states may get even more out of the higher cap by bunching their itemized deductions.

For example, if you paid your 2025 property taxes earlier this year and receive a bill for 2026 in December, pay it before December 31 so you can deduct both payments on your 2025 tax return, Davido says.

Using the bunching strategy, you would claim the standard deduction in 2026 and make two property tax payments in 2027 so you can itemize in that year.

Bunching your charitable contributions is also an effective way to increase your itemized deductions and lower your tax bill.

A donor-advised fund is a useful tool for this strategy. These funds, offered by major financial institutions, allow you to make a large contribution, deduct the donation on the current year’s tax return, and decide later which charities you want to support.

However, there are other provisions in OBBBA that could reduce the effectiveness of this strategy, which we’ll discuss below.

NEW STRATEGIES FOR CHARITABLE CONTRIBUTIONS

As you consider your year-end charitable contributions, it’s important to understand new tax breaks for givers — along with new limits on how much some donors will be allowed to deduct.

Starting in 2026, taxpayers who don’t itemize can deduct up to $1,000 in charitable contributions, or up to $2,000 for married couples who file jointly. Donations to donor-advised funds and private foundations aren’t eligible for this new deduction.

If you don’t itemize and want to take advantage of this tax break, consider making the charitable contributions you’d ordinarily make by the end of this year in January 2026 instead.

Meanwhile, taxpayers who itemize on their tax returns and deduct charitable contributions will be subject to a new limit on the amount they can deduct. The maximum amount of cash gifts donors can deduct will remain at 60% of AGI.

However, starting in 2026, the deduction will be limited to the amount of charitable contributions that exceed 0.5% of adjusted gross income, Steffen says.

For example, a married couple with AGI of $100,000 who donate $700 to charity will be permitted to deduct only $200.

To avoid that new floor, itemizers may want to make their 2026 contributions in 2025, keeping in mind how that will affect other aspects of their tax bill.

Taxpayers in the top tax bracket (for 2025, that includes income higher than $626,350 for singles or $751,600 for joint filers) may also want to accelerate charitable contributions into 2025 because of a cap on all itemized deductions those taxpayers can claim.

Starting in 2026, the amount of itemized deductions taxpayers in the 37% tax bracket can claim will be limited to 35% of their taxable income.

MORE BENEFITS FOR HEALTH SAVINGS ACCOUNTS

A health savings account can be a valuable tool to set aside money for both current and future health care expenses. An HSA provides a triple tax break: Your contributions are tax-deductible (or pretax if made through your employer), the money grows tax-deferred, and you can use it tax-free for eligible medical expenses in any year.

After you turn 65, you can also withdraw money tax-free from the HSA for Medicare premiums, in addition to other out-of-pocket health care costs.

The new law has three HSA-related provisions. Starting on January 1, 2026, you can withdraw up to $150 per month ($300 for couples) from an HSA tax-free to pay monthly or annual fees for direct primary care arrangements (also known as concierge medicine), in which doctors provide services in exchange for a membership fee.

The law also clarifies that enrolling in a direct primary care arrangement does not disqualify someone from being able to contribute to an HSA if they also have an eligible high-deductible health policy.

Not all concierge practices qualify under the new law as direct primary care arrangements — there are limits to the types of services they can provide beyond primary care.

Additionally, the law permanently exempts telehealth services from the HSA-qualified plan deductible. Most medical care, except for some preventive care, must be subject to the deductible for a health insurance policy to be HSA-qualified.

During the COVID pandemic, you could receive some telehealth services without first paying the plan’s deductible — typically with a $5 or $10 co-payment — but that rule expired at the end of 2024. The OBBBA permanently exempts telehealth from the deductible requirements, retroactive to January 1, 2025.

Finally, bronze plans and catastrophic plans sold on the Affordable Care Act insurance marketplace will automatically be HSA-qualified, starting with the 2026 plan year.

Using an HSA-eligible bronze plan and making tax-free withdrawals from your HSA to pay for direct primary care could be a win-win, says Roy Ramthun, founder and president of HSA Consulting Services LLC in Silver Spring, Md.

You can sign up for direct primary care for your regular doctor’s visits but have a high-deductible bronze plan as a backstop if you end up needing expensive medical care. You’ll be eligible to contribute to an HSA, and you can also use HSA money tax-free to pay the monthly direct primary care fees.

Notably, the version of the OBBBA that originally passed the House of Representatives would have allowed people who sign up for Medicare Part A to contribute to an HSA. But that provision wasn’t included in the final law, so the current rules still stand: You can make HSA contributions only if you haven’t enrolled in either Medicare Part A or Part B.

If you or your spouse is still working and you have health insurance from an employer with 20 or more employees, you can delay signing up for Part A and Part B. But you must enroll within eight months of losing that coverage; otherwise, you could face a lifetime late-enrollment penalty for Part B.

If you sign up for Part A after you turn 65, that coverage takes effect up to six months retroactively. Keep that time frame in mind when calculating your HSA contribution.

CHANGES TO THE HEALTH INSURANCE MARKETPLACE

Several administrative changes are coming to Affordable Care Act marketplace coverage because of provisions in the OBBBA, as well as new rules from the Centers for Medicare & Medicaid Services.

The open-enrollment period to sign up for a marketplace plan will be shorter. Next year, open enrollment for the federal marketplace (HealthCare.gov) will run from November 1, 2026, to December 15, 2026. States that operate their own marketplaces won’t be allowed to extend open enrollment past December 31. Currently, open enrollment goes to January 15, and even longer in some states.

Before you enroll in a marketplace plan, you’ll need to provide evidence of income eligibility for tax credits for your premiums. (Currently, you have 90 days after you enroll to submit the information.)

If your income increases after you enroll and you don’t update your information with the marketplace, you may have to pay back the extra subsidy when you file your income tax return.

Under the previous rules, there were limits to how much you have to pay back if you underestimate your income.

Enhanced subsidies are scheduled to expire

Perhaps the most consequential outcome for ACA plan enrollees is that the OBBBA didn’t extend enhanced premium subsidies for marketplace coverage. The enhanced subsidies are set to expire at the end of 2025, and Congress probably won’t pass additional legislation to extend them.

So the size of the subsidies and the income levels to qualify are likely to shrink significantly on January 1, 2026. People who earn more than 400% of the federal poverty level will no longer be eligible for any subsidies after 2025. For 2026 marketplace plans, 400% of the poverty level is $62,600 for singles and $84,600 for couples.

If you have individual health insurance from the ACA marketplace and you plan to do Roth conversions, you may want to convert more money before the end of 2025 than in 2026, when the extra income may make you ineligible for the subsidy.

“For a retired client, we’ve been able to do about $100,000 of Roth conversions yearly with the enhanced premium tax credits,” says Mark Whitaker, a CFP and founder of Retirement Advice LLC, a fee-only financial planning firm in Provo, Utah.

“Going forward, to hit their ACA subsidy levels, they will only be able to do about $60,000 of Roth conversions a year.”

But be sure to consider other variables, too, such as your tax rate and other income cut-offs. (For more, see the section above on the bonus deduction for older people.)

UPDATES FOR FAMILIES

If you have kids at home, you may benefit from multiple provisions in the OBBBA.

More-generous tax credits for parents

The OBBBA permanently extends the child tax credit and increases it to $2,200 per child, up from $2,000. The credit phases out for singles with modified adjusted gross income of $200,000 or more and married couples who file jointly with MAGI of $400,000 or more.

The OBBBA also makes permanent a separate credit of up to $500 for families with other dependents, such as parents or adult relatives.

The adoption tax credit is more valuable, too. If you adopted a child this year, you can claim a credit for up to $17,280 in eligible expenses. Here’s what’s new: $5,000 of the tax credit will be refundable.

In other words, taxpayers with tax liability of less than $5,000 can still claim that portion of the credit, which means some of that amount could be returned to parents as a refund.

Starting in 2026, the maximum tax credit parents can claim for child and dependent care expenses, such as the cost of day care or a nanny, will increase to 50% of as much as $3,000 in expenses for one dependent and 50% of as much as $6,000 for two or more dependents (both up from 35%).

The credit decreases based on adjusted gross income to as little as 20% of expenses, but OBBBA increased the income thresholds. For married couples with AGI between $150,000 and $210,000, the credit ranges from 35% to 20%. Couples with AGI of $210,000 or more are eligible for a credit of 20% of expenses.

Expanded uses for 529s

Originally designed as a tax-advantaged way to save for college, 529 plans have been expanded over the past several years to permit tax-free withdrawals for certain non-college expenses, too. The OBBBA extends these uses even further.

“The new rules allow up to $20,000 per year to be used for elementary and secondary school tuition, course materials, tutoring, fees for standardized tests, and more,” says Robert Farrington, founder of the website The College Investor.

Previously, tax-free withdrawals of 529 money for K-12 students were limited to tuition, up to $10,000 annually.

The legislation also permits tax-free 529 withdrawals for certain other expenses, such as non-degree credential programs for plumbing, electrical, HVAC and some other trades; certification and licensing expenses; and continuing education required to maintain those licenses.

That means beneficiaries who don’t go to college will have additional ways to benefit from tax-advantaged 529s.

The law permanently allows rollovers from 529 plans to ABLE accounts, where the money can continue to grow tax-deferred for people with disabilities who may not go to college.

Most of the changes related to 529 distributions took effect as soon as the law was signed on July 4, although the increased, $20,000 annual limit for K-12 expenses doesn’t apply until the 2026 tax year.

Keep in mind that not all states have altered their rules to follow the federal expansion. “For example, California doesn’t allow 529 plans to be used for elementary or secondary school expenses,” says Farrington.

Trump accounts for kids

The OBBBA introduces a new investment account — known as a Trump account — for kids younger than 18, and the government will seed the account with $1,000 for children born between January 1, 2025, and December 31, 2028.

Parents and others can contribute up to $5,000 a year to the account until the child turns 18. Contributions are invested in a fund that tracks a broad U.S. stock index, and they grow tax-deferred.

You may have better options for your child’s long-term savings. Annual contributions are not tax-deductible, and earnings are taxed at the beneficiary’s income tax rates when withdrawn.

Unless the money is used for certain expenses, such as education or up to $10,000 for a first-time home purchase, you’ll have to pay a 10% early-withdrawal penalty before age 59½.

“The only advantage of Trump accounts is the $1,000 birthday gift for newborn children. Families should, of course, accept the free money,” says Mark Kantrowitz, a college-savings expert and author of How to Appeal for More Financial Aid.

But for your child’s future college expenses, you’re better off contributing to a 529 plan, because withdrawals for qualified educational expenses are tax-free.

LAST CHANCE TO CLAIM TAX CREDITS FOR THESE ENERGY-SAVING MOVES

The OBBBA speeds up the deadlines to take advantage of certain tax credits related to saving energy.

The Energy Efficient Home Improvement Credit, which provides a 30% tax credit toward the cost of energy-efficient windows, home energy audits, heat pumps and other energy-saving home improvements, was previously scheduled to phase out in 2033. (The law imposed annual limits for certain projects, such as $600 for exterior windows and skylights.)

But now, the credit expires at the end of 2025. The Residential Clean Energy Credit, which provides a tax credit of up to 30% for more-ambitious projects, such as solar electric panels and solar water heaters, will also expire on December 31. The equipment must be installed and operational by year-end to qualify for the credit.

Additionally, the $7,500 EV tax credit to buy or lease qualified electric vehicles, along with the $4,000 credit for eligible used EVs, ends September 30, 2025.

At the same time, however, the OBBBA provides a new tax break for car buyers: a deduction of up to $10,000 in interest on loans for cars purchased between 2025 and 2028.

You don’t have to itemize to claim this deduction, but it’s available only for loans taken out to buy new cars assembled in the U.S., which rules out many popular models. The deduction phases out for individuals earning more than $100,000 or married couples making more than $200,000.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

Related content

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• How Will the One Big Beautiful Bill Shape Your Legacy?
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The One Big Beautiful Bill (OBBB), signed into law in July, made headlines with promises of tax relief and economic growth. But for retirees, the reality is more complicated and, in many cases, more costly.

While the law extends some favorable tax brackets and introduces deductions for older Americans, several provisions do little to support people already in retirement.

Others could quietly raise your costs or trigger unintended tax consequences if you're not careful.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

If you're retired (or preparing to retire) here's how the new law might affect your finances and what steps to take to protect yourself.

Roth conversions could now do more harm than good

Roth conversions used to be a smart way to control future taxes. With today's lower rates, many retirees converted pretax IRA funds to Roth accounts to lock in those rates and enjoy tax-free growth.

But under the OBBB, this strategy is no longer a slam dunk. Why?

• The new bonus deduction for people 65 and older lowers taxable income, but not adjusted gross income (AGI).
• Roth conversions increase AGI, which determines how much of your Social Security is taxed and whether you'll face IRMAA surcharges on Medicare.
• Some retirees now face a "sneak attack," in which they stay in the same tax bracket, but pay thousands more in Medicare premiums or lose Social Security purchasing power due to added taxation.

What to do: Don't abandon Roth conversions altogether, but be precise. Smaller partial conversions spaced out over several years could help you reduce lifetime taxes without triggering costly ripple effects.

Be sure to run multiyear tax projections that include Social Security taxation and IRMAA thresholds.

It's also a smart idea to calculate your future required minimum distributions (RMDs) at and after age 73.

If those RMDs are projected to push you into the 24% bracket, consider converting enough now to maximize the 22% bracket while you still can.

We don't know what future tax rates will be, but paying taxes now at known rates might be smarter than waiting.

If you're unsure where you stand, get help from an advisor who uses software that models potential long-term tax savings from conversions under current law, which can be a powerful tool for retirement decision-making.

The estate tax exemption rose, but don't let that fool you

The bill raises the federal estate tax exemption to $15 million per person through 2030, but for the majority of retirees, this does nothing to ease the burden of estate clarity, tax efficiency or family coordination.

Unfortunately, many people assume that if they're under the estate tax limit, they don't need to plan. That's a mistake.

Most estate planning issues have nothing to do with taxes and everything to do with:

• Unclear or outdated beneficiary designations
• No instructions for incapacity or health care decisions
• Family disputes about property, debt or inheritance
• Missed charitable or legacy goals

What to do: Revisit your estate plan, regardless of your net worth. A current will, power of attorney, health care directive and coordinated beneficiary structure are essential.

If you're charitably inclined, consider using a qualified charitable distribution (more about this below), or setting up a donor-advised fund (DAF). A DAF allows you to donate a large sum in a high-income year.

For example, if you're converting a large amount to a Roth, you can offset the tax impact while maintaining flexibility in how you give over time.

Medicare cuts might raise your out-of-pocket costs

To fund permanent tax cuts, the OBBB includes more than $490 billion in Medicare reductions in the next decade.

The law doesn't spell out exactly how those cuts will be implemented, but they could result in:

• Higher Part B and D premiums
• Reduced coverage areas for Medicare Advantage plans
• Lower provider reimbursements that make it harder to find care
• More out-of-pocket expenses for medications or specialist visits

What to do: Plan for rising health care costs, even if your income stays flat. Review your supplemental coverage annually, and don't assume your plan from last year will still serve you next year.

Consider building a dedicated health care reserve into your retirement income strategy.

Charitable giving incentives are nice, but not a game-changer

The OBBB includes a new $2,000 charitable deduction for non-itemizers age 65 and older. That's a welcome change, but it might not move the needle much, especially for those who already use qualified charitable distributions (QCDs) from IRAs for tax-efficient giving.

What to do: If you're age 70½ and older and have an IRA, QCDs remain one of the most powerful giving tools available, allowing you to reduce your RMD income and support causes you care about — all without increasing your AGI.

For more flexibility, combine your giving with a donor-advised fund. This can be especially effective if you're doing Roth conversions or realizing gains in a single year and want to offset that added income.

Income stacking could trigger tax surprises

The OBBB keeps lower income tax brackets, but those brackets still interact with other parts of the tax code in ways that can sneak up on retirees. For example:

• RMDs stack on top of other income
• Capital gains could become taxable when layered with dividends, pensions or Social Security
• You could unintentionally cross into a higher effective tax rate even if your marginal bracket doesn't change

What to do: Be intentional about withdrawal sequencing. In some years, it might make sense to draw from Roth accounts to stay under Medicare or tax thresholds. In others, you could realize capital gains up to the 0% tax rate.

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Consider using tax-efficient investments in your non-qualified (taxable) accounts.

By focusing on low-turnover funds, municipal bonds or actively managed portfolios with tax-loss harvesting strategies, you might reduce your annual tax liability while keeping more of your investment income.

The bottom line

The OBBB might have promised sweeping relief, but for retirees, it offers more caution than comfort.

The next few years will require sharper planning, not just to avoid tax surprises, but to build in flexibility for rising health care costs, shifting income needs and legacy goals.

The good news? You still have time to make smart moves that can protect your future. Work with a financial professional who understands how today's rules impact retirement and how to adjust as things evolve.

At Dorhout Retirement Services, we help people retire with clarity and confidence, even when the rules change. If you're unsure how this new legislation affects your income, taxes or estate, we're here to help.

Grant Dorhout offers investment advisory services through CWM, LLC, an SEC Registered Investment Adviser. This article is not intended to provide specific legal, tax, or other professional advice.

For a comprehensive review of your personal situation, always consult with a tax or legal adviser.

Converting from a traditional IRA to a Roth IRA is a taxable event.

Generally, a donor-advised fund is a separately identified fund or account that is maintained and operated by a section 501(c)(3) organization, which is called a sponsoring organization. Each account is composed of contributions made by individual donors. Once the donor makes the contribution, the organization has legal control over it. However, the donor, or the donor's representative, retains advisory privileges with respect to the distribution of funds and the investment of assets in the account. Donors take a tax deduction for all contributions at the time they are made, even though the money may not be dispersed to a charity until much later.

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• Seven Medicare Changes Coming in 2026
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• Five Under-the-Radar Shifts Investors and Job Seekers Can't Afford to Ignore Under the OBBB
• How to Maximize Your Social Security Now That the One Big Beautiful Bill Is Law

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

There's growing speculation that the Federal Reserve might start lowering interest rates later this year or next.

While no one can precisely predict when, it's useful to consider how a lower rate environment could influence financial decisions related to housing, estate planning, taxes, investing and retirement.

Housing

Housing is often the most noticeable area affected by falling rates. A rate drop isn't a magic solution for your housing plans, but it is an opportunity to reset and gain flexibility.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

If mortgage rates decrease, mobility may increase, giving more families the freedom to buy, sell or relocate.

However, it's important to keep in mind the broader financial implications of moving, such as property and casualty insurance costs and availability.

Adjustable-rate mortgages (ARMs) taken out in 2021 or 2022 are nearing reset, and although refinance rates may not be as low as they were then, they still appear more favorable than current levels.

For some households, tapping into home equity via a HELOC might also be a smart option if borrowing costs decline.

What you can do: Review your mortgage and debt. If you have an ARM or other variable-rate debt, think about refinancing to a fixed rate while rates are still historically favorable.

A lower rate could also make it a good time to consider using home equity through a HELOC for planned expenses or debt consolidation.

Estate planning

Estate planning becomes more relevant in a lower-rate environment. Strategies like grantor retained annuity trusts (GRATs) and intrafamily loans become more effective when the IRS' Section 7520 rate drops.

It's easier to shift appreciation out of an estate when the so-called "hurdle rate" is lower, which can help preserve wealth for future generations.

What you can do: Reassess your estate plan. If you're a high-net-worth individual, consult with your estate planning attorney about strategies like a GRAT.

These become more effective when the IRS 7520 rate (a benchmark for trust asset valuation) is lower, enabling you to transfer more wealth to heirs tax-free.

Tax planning

Falling interest rates can suggest slowing inflation. Since federal tax brackets and the standard deduction are indexed to inflation, slower growth may lead to smaller upward adjustments. This could place more income into higher tax brackets.

Simultaneously, lower borrowing costs often boost asset values, increasing capital gains exposure — a beneficial challenge if managed carefully.

Lower rates may also encourage more charitable giving. Certain planned giving strategies become more advantageous if rates are lower.

For example, a charitable lead trust (CLT) might become more attractive than a charitable remainder trust.

It's worth noting that starting next year, a provision in the One Big Beautiful Bill (OBBB) will reduce the deduction for households in the highest tax bracket from 37% to 35%, so timing is critical.

What you can do: Analyze your tax strategy. A lower-rate environment may boost asset values, increasing exposure to capital gains taxes — a positive problem to have. Consider strategies like tax-loss harvesting to offset gains.

For charitable giving, a CLT might be more appealing, as lower rates reduce the gift tax value of the remainder interest.

Investing

In a lower-rate environment, diversification isn't just a strategy — it's your best defense.

Investments tend to respond strongly to changes in interest rates. Historically, large-cap stocks perform well when rates decline.

Companies benefit from cheaper borrowing, and investors often shift from bonds to stocks when yields fall.

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Nonetheless, diversification remains essential. While yields on new bonds may reset lower, the value of existing fixed income holdings typically rises.

Managing reinvestment risk alongside opportunities makes portfolio management more important than ever.

What you can do: Examine your asset allocation. While declining rates may favor equities, they also reduce yields on new bonds.

Ensure your portfolio balances growth-oriented assets (like stocks) with stable, income-producing assets (like bonds) to reduce longevity risk and support your long-term goals.

Retirement planning

Retirement planning also needs attention in a declining rate environment. Lower yields can make conservative portfolios more vulnerable, underscoring the importance of including growth assets that support long-term objectives.

A proper mix of fixed income stability and equity growth helps mitigate longevity risk in a world where bonds alone may no longer suffice.

What you can do: Update your retirement projections. Lower bond yields can impact the income from your retirement portfolio.

Run new projections using a more conservative income assumption from fixed-income assets to keep your spending plan sustainable.

Adjust your savings rate or portfolio mix as needed.

Putting it all together

The potential of falling interest rates isn't a signal to overhaul your entire financial plan, but rather an opportunity to review and refine it. A proactive approach is vital.

By understanding how these changes could impact your housing, estate, tax and investment strategies, you can position your finances to benefit from the new environment.

The shift toward lower rates highlights the timeless importance of a well-diversified portfolio and a long-term perspective. While short-term market reactions may grab headlines, the true measure of a sound financial plan lies in its resilience and adaptability.

I often remind clients that the goal isn't to predict the future but to prepare for it, whatever it may bring.

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• You Don't Want It, But You Should Plan for It Anyway: An Expert Guide to Long-Term Care
• Will My Children Inherit Too Much?

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

One of the biggest Powerball jackpots in history — more than $1.4 billion — was just claimed. Whenever news of lottery wins this big breaks, people across the country start imagining what they would do if luck struck their numbers.

For most, the dream ends with visions of mansions, luxury cars or world travel. For the lucky few who win, their lives will be forever changed.

So, imagine it really does happen to you; you win the jackpot. First things first: relax. I know the adrenaline is still rushing, but the first thing to do is to pause and breathe.

Then, before you do anything else, seek the right legal counsel. You need a financial adviser who specializes in working with lottery winners, a trusted professional who understands how to navigate the state's gaming department and set up trusts that can protect your identity wherever possible.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

Protecting your identity and your winnings

For years, my team and I have worked with lottery winners. I've seen the difference it makes to get the right team in place early. Making sound investment decisions can mean the difference between long-term stability or losing it all. Nearly 70% of lottery winners exhaust their winnings within a few years.

You can avoid the spotlight through carefully designed trusts and other legal instruments.

Taxes are another major consideration, with federal income tax brackets starting at 24% and climbing, depending on your income. Hence, it's critical to work with a trusted financial adviser who understands these specific issues.

Building a family office

I suggest that lotto winners establish what is essentially a family office — a structure that supports their financial lives from day one.

A financial adviser can guide decisions on how assets should be owned, whether in trusts, LLCs or other entities. Much of this work overlaps with estate planning, because sudden wealth makes questions about long-term protection unavoidable.

But for many of my clients, the conversation quickly turns to something even more lasting: philanthropy.

After the houses, the cars, the trips and the gifts to relatives, the truth settles in — you have more wealth than you'll ever reasonably spend. At that point, the real opportunity presents itself: how to give back in ways that reflect your values and build your legacy.

Author Shannon Alder put it well: "Carve your name on hearts, not tombstones. A legacy is etched into the minds of others and the stories they share about you."

Philanthropy as a mission, not a hobby

Philanthropy is not simply about writing checks. It's about aligning resources with your mission to do good. And while anyone can be a philanthropist, substantial resources allow you to scale that mission into something enduring.

The question for you as a lottery winner is how to transform your charitable intentions into a structured, lasting plan.

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Donor-advised funds (DAFs) and private foundations are among the most powerful vehicles to do this. DAFs have surged in popularity in recent years, with contributions reaching $85 billion in 2022.

These vehicles allow you to receive an immediate tax deduction, invest the assets for growth and distribute grants over time to the charities that align with your values.

But before you select a giving vehicle, you need clarity about your mission:

• What do you want your wealth to stand for?
• How do you want your children or grandchildren to understand the role of this gift in their lives?

I often guide clients through a thought experiment: Imagine you've already provided financial security for your heirs, and they have what they need to live comfortably.

At that point, the question becomes not how much more to give them, but how to pass down your values — helping to ensure your legacy reflects more than wealth alone.

That, ultimately, is what philanthropy allows you to do.

From wealth to legacy

Of course, it is not always straightforward. Once people know you have won big, you will be approached from every angle — acquaintances with new-business ideas, organizations seeking donations and even bad actors.

This is where having a trusted adviser becomes essential. A qualified financial adviser can help you filter opportunities, weigh risks and align your giving with your financial goals.

In my practice, I encourage clients to think of giving as a parallel track to wealth management — not a separate afterthought, but a central element of their financial identity.

Winning the lottery is an extraordinary stroke of fortune. But true wealth is not measured only by what you keep. It is measured by the lives you touch, the communities you strengthen and the values you carry forward.

That is the kind of legacy money cannot buy — but philanthropy can.

ALINE Wealth is a group of investment professionals registered with Hightower Securities, LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities, LLC; advisory services are offered through Hightower Advisors, LLC.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

If you've been following Kiplinger, you should have no trouble with this quiz. And if you slip up on an answer or two, you can follow the links below the quiz to refresh your memory.

Related Content From Adviser Intel

These are the Kiplinger stories featured in this quiz:

• I'm a Financial Planner: Here Are Five Phases of Retirement Planning You Have to Get Right
• One Big Beautiful Bill, One Big Question: Will We Keep Giving?
• An IRS Enrolled Agent's Top 10 Reasons to Stop Doing Your Own Taxes

The Washington Post recently profiled a man from Baltimore County, Md., who spends his free time — actually, pretty much all of his time — retrieving illegally abandoned tires from stagnant creeks and mosquito-infested swamps.

Since 2013, Jon Merryman has dug up an estimated 15,000 tires and has set a goal of picking up tires in every county in the U.S. The average tire weighs 25 pounds, so he doesn’t need to go to the gym to stay in shape.

While most of us aren’t as driven as Merryman, just about everyone I know has expressed a desire to volunteer in retirement. Along with the recipients of their generosity, volunteers reap the rewards, too: Research has shown that older people who volunteer on a regular basis are less likely to suffer from age-related health problems and cognitive decline.

The key is finding a good fit. In some cases, that may involve volunteering for an organization that will benefit from your professional skills.

A friend of mine who has a background in health care is a volunteer for the State Health Insurance Assistance Program, which helps Medicare beneficiaries navigate their benefits at no cost.

Another friend, a longtime journalist, is helping high school students publish a local newspaper.

Tax breaks for volunteers

The IRS doesn’t allow you to deduct the value of the time you spend volunteering. But if you itemize on your tax return, you can deduct some of the out-of-pocket costs associated with charitable work.

For example, if you transport dogs for a rescue organization, you can deduct the cost of gas, tolls and parking.

You can deduct either the IRS flat rate of 14 cents per mile or your actual costs. (Congress hasn’t adjusted the flat rate since 1998, so you’ll probably get a larger deduction by tracking actual expenses.)

If you travel on behalf of the charity, you can deduct air or train fare, lodging, and meals, as long as the trip is primarily for the organization.

Most retirees claim the standard deduction, so they can’t take those itemized deductions. But volunteering is a great way to determine whether an organization will make good use of any money you donate — and those contributions could lower your taxes even if you don’t itemize.

If you’re 70½ or older, you can transfer up to $108,000 for 2025 from your traditional IRA to a charity (or charities) of your choice by making a qualified charitable distribution (QCD). The contribution isn’t deductible, but it will be excluded from your adjusted gross income, which could shield you from certain taxes and surcharges tied to your AGI, such as extra charges that are added to your Medicare premium if your modified adjusted gross income exceeds a certain threshold. Once you turn 73, the QCD will count toward your required minimum distribution.

Another option is to use a donor-advised fund. These funds, offered by most major financial institutions, allow you to make a charitable contribution now, take the deduction on your 2025 tax return, and decide later which charities to support. Even if you don’t itemize, donating stocks or other assets that have increased in value will provide a tax break because you won’t have to pay taxes on capital gains (and the charity won’t, either).

I’m planning to take advantage of QCDs when I turn 70½. In the meantime, I’ve signed up to help the AARP Foundation’s Tax-Aide program, which provides free tax assistance to low- and moderate-income taxpayers.

I’ve written about taxes for more than 20 years and am all too familiar with how complex they can be, so this seems like a good way to give back. Plus, no mosquitoes.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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Charitable giving has long been encouraged through the U.S. tax code, offering incentives to those who support nonprofits and mission-driven causes. But the recently passed One Big Beautiful Bill (OBBB) could change that calculus — especially for high-income donors.

While the bill touches many areas of federal policy, one provision has stirred debate: a reduction in the tax benefits tied to charitable giving.

That's especially troubling given that charitable giving in the U.S. declined by 10.5% in 2022 — the largest drop in decades. These changes could deepen that slide.

Still, for most high-net-worth (HNW) donors, the motivation to give extends far beyond tax deductions.

If you're considering significant charitable gifts, now is the time to take action: Have a conversation with your tax adviser about your plans and ensure your giving priorities reflect your deeper values, not just financial optimization.

Kiplinger's Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.

A new set of rules

Under the new rules, high-income donors will get a smaller tax break. Previously, you could deduct up to 37% of your donation.

Now, no matter your tax bracket, you can deduct only 35% of your donation. So, if you give $1,000, you'll get a $350 tax deduction instead of $370.

There's also a new rule for itemizers that puts a 0.5% floor on charitable deductions. Essentially, only the portion of your charitable contribution that exceeds 0.5% of your adjusted gross income is deductible starting in 2026.

So, if you make $1 million a year, you can't deduct the first $5,000 you donate. Businesses will face a similar change — they can only deduct gifts that are more than 1% of their income.

The bill also reinstates a universal above-the-line charitable deduction for people who don't itemize. Individuals may deduct up to $1,000, and married couples filing jointly can claim up to $2,000.

However, this doesn't apply to donor-advised funds (DAFs) or private non-operating foundations, and it isn't indexed for inflation, meaning its value may diminish over time.

These changes come on top of structural reforms already in place. The Tax Cuts and Jobs Act of 2017 nearly doubled the standard deduction, and as a result, only about 9% of households itemize. For many, the charitable deduction has already been out of reach.

To put this into context: A couple with $1 million in adjusted gross income (AGI) could normally deduct up to $600,000 in qualified charitable donations, based on the 60% limit. Under the new law, the first $5,000 doesn't count, so they would need to donate $605,000 to receive the full benefit.

With these changes looming in 2026, it's smart for both high earners and business owners to review their giving strategy. Consider timing larger gifts or "bunching" donations into a single year for potential tax benefits.

How will giving be affected?

It's easy to assume that these changes will discourage donations. From my experience, high-income families tend to give because they care about causes and community — not simply because of the tax deduction.

According to the Bank of America Study of Philanthropy, 85% of affluent households gave to charity in 2022, and for most, the motivation was personal. Nearly 70% said their donations were driven by values and beliefs, not tax incentives.

While deductions still play a role, especially for larger gifts, they aren't the deciding factor. So even with a smaller tax benefit or a new income threshold, most donors are likely to continue supporting the causes they care about.

If you want your giving to have the biggest impact, take some time now to clarify your top priorities and talk openly with your family or advisers about your philanthropic goals.

Setting up regular giving or making a long-term commitment to a nonprofit you trust ensures that your impact remains strong, even with evolving tax incentives.

Broader giving at risk, but there's a possible upside

For middle-income Americans, the impact may be more noticeable. A household earning $300,000, for instance, would only be able to deduct charitable donations exceeding $1,500.

That threshold could discourage smaller or one-time gifts that are made with tax incentives in mind.

Despite this, Americans continue to give at high levels. In 2021, 74% of U.S. adults donated to non-religious causes, according to Gallup, up from 64% in 2020.

Even in challenging times, generosity endures. The cultural norm of giving is strong — and not easily undone by tax changes.

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The return of the universal charitable deduction may encourage broader participation in giving, particularly among non-itemizers. While the amount isn't huge, it could reinforce the habit for households that already give.

Those who are just beginning to build their philanthropic routines might use this modest deduction as a foundation for more intentional, long-term giving — even if it starts small.

If you're concerned about thresholds, track your giving throughout the year to see when you qualify for a deduction, and don't underestimate the power of small but consistent gifts.

Whenever possible, take advantage of employer matching programs or join community fundraisers to stretch the impact of your donations, even if the tax benefit is modest.

Strategic giving in a shifting landscape

The OBBB underscores the importance of approaching charitable giving with a clear strategy.

Charitable trusts and family foundations offer flexibility and help preserve a philanthropic legacy. Non-cash gifts, such as appreciated securities, may still provide strong tax advantages under the new rules.

For families, now is an ideal time to make philanthropy a shared value — involving the next generation in giving decisions and conversations.

Even if itemizing no longer makes sense for your household, your charitable impact doesn't have to diminish.

The One Big Beautiful Bill might change the way we give — but it doesn't change why we do it.

If you haven't already, now is a smart time to sit down with your adviser and revisit your charitable plan.

Make it a habit to review your giving strategy annually so you can adapt, stay informed and make the most powerful difference possible with every gift you give.

ALINE Wealth is a group of investment professionals registered with Hightower Securities, LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities, LLC; advisory services are offered through Hightower Advisors, LLC.

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• When Should Retirees Consider a Donor-Advised Fund?
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• How to Give to Charity and Also Generate Retirement Income

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

We're living in a world that can often feel out of control and headed in a direction that is less democratic, inclusive and compassionate.

If you're feeling powerless, it's good to remember that nothing speaks louder than your dollars.

I'll explore three things you can do with your money to help bring about a more just and sustainable world for all.

Align your investments with your values

If your investments are tied up in mutual funds or exchange-traded funds (ETFs), it might be difficult to know exactly in which companies you're invested. You might be funding industries or practices that are out of line with your personal values.

The Kiplinger Building Wealth program, which will soon be renamed Adviser Intel (with all the same expert content), handpicks financial advisers and business owners from around the world to share retirement, estate planning and tax strategies to preserve and grow your wealth. These experts, who never pay for inclusion on the site, include professional wealth managers, fiduciary financial planners, CPAs and lawyers. Most of them have certifications including CFP®, ChFC®, IAR, AIF®, CDFA® and more, and their stellar records can be checked through the SEC or FINRA.

According to the US SIF Trends Report 2024/2025, sustainable investing now accounts for $52.5 trillion in U.S. assets under management, with $6.5 trillion explicitly marketed as environmental, social, governance (ESG) or sustainability-focused.

To find out more about what you're actually invested in, check out this handy Invest Your Values tool provided for free by As You Sow.

Talk to your financial adviser or investment manager about the things you do and don't want to profit from. Ask them to provide you with an audit of your portfolio and how the holdings (or companies) are aligned with ESG and socially responsible investing (SRI) strategies.

These could include screening out companies whose practices support the sale of weapons, fossil fuels and tobacco, as well as opting into companies that support the United Nations Sustainable Development goals.

Not all financial advisers or investment managers will provide this information or will want to engage in this type of conversation.

If your adviser doesn't do this, and you want to work with someone who'll respect and honor your values, you might consider checking out ValuesAdvisor's database of advisers who work specifically in this area of financial services.

Give to nonprofit organizations closest to the pain

Many large, well-known charities lack transparency in reporting how their funds are allocated, and many, if not most, are not led by the people who most deeply understand the problem they're trying to solve.

Focus your giving on local grassroots organizations led by people who are most directly impacted by the injustice that you are passionate about solving. These groups often do the hardest work with the least funding, and your support makes a significant impact.

Groups such as mutual aid networks, community bail funds, immigration sanctuary support groups and local climate collectives are just some examples of where to give.

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When choosing a charity to support, it's important to look for organizations that are transparent about their mission, leadership and how funds are allocated. Most reputable nonprofits will typically share regular impact reports or clear breakdowns of their programs and outcomes on their website.

If you're not sure how best to evaluate grassroots groups that are best suited to the issue you want to support, or if you're looking for community in these troubled times, consider becoming a part of a "donor network."

Donor networks bring together like-minded people to learn, engage and give collectively to grassroots groups. Examples include Women Donors Network, Solidaire and Movement Voter Fund.

If you don't have a lot of money to spare, consider doing more than writing a check. Work to mobilize fellow community members to donate.

If you have access to a bigger platform, invite leaders from your local organizations to engage with your personal network about their current projects.

Consider 501(c)(4) organizations over political party donations

Donating to national political parties can sometimes feel like tossing money into a black hole, and it's nearly impossible to know how your donations are being allocated.

Consider contributing to 501(c)(4) nonprofits engaged in political advocacy and organizing.

Defined by the IRS as a "social welfare organization," a 501(c)(4) can engage in political and lobbying activities more freely than traditional charities, making them a powerful tool for driving policy and systemic change.

They often fund on-the-ground mobilizing, voter education and advocacy that drives policy change, especially in underrepresented communities. Many 501(c)(3) nonprofit organizations have 501(c)(4) arms, as well.

A values-aligned financial adviser can help you find 501(c)(4) organizations in your area. While these donations are not tax-deductible, your donation will likely have a more direct impact on public policy.

Final thoughts

We're living in a chaotic and overwhelming time.

Many of us are concerned about where our political environment is leading us and fear for our future, as well as the future of those we love.

Now is not the time to hide or ignore what's going on around us. Follow your money, and make sure it's leading you and the ones you love toward a brighter future for all of us.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Alan Jinich is the national facilitator for StoryCorps, a nonprofit organization that aims to record and share the stories of the American experience. He recently spoke to Kiplinger Personal Finance Magazine about the organization's work and how anyone can get involved and share their own story.

Question: What is StoryCorps?
AJ: StoryCorps is a nonprofit oral-history organization dedicated to recording the stories of everyday people across the U.S. We record conversations between two people and archive them with the Library of Congress in what’s now the largest collection of human voices ever gathered — more than 700,000.

Question: What is your role as a national facilitator?
AJ: I bring people together for these conversations and guide them through the recording process. I travel wherever I’m needed with a recording kit, and I also help run our booth in downtown Manhattan, which is a studio space open to the public. Some facilitators are on the mobile tour, traveling around the country in an Airstream trailer equipped with a studio.

Most conversations are between people who already know each other, but sometimes people come in on their own, and I or another facilitator interview them. Participants typically come up with their own questions to ask each other, so the stories can go anywhere and are very wide-ranging. Some people want to share childhood memories or their experiences in the military. And some want to ask their loved ones big questions that they normally don’t get the opportunity to ask.

Question: How did you get involved?
AJ: I became interested in oral history during the pandemic, while studying neuro­science in college. When classes went virtual, my best friend and I decided to take a semester off from school and ended up borrowing my mom’s car to road-trip around the country and record stories from young people. We drove from our hometown in Maryland all the way to Utah and back, recording more than 80 oral histories across 16 states. It was an incredible experience, and you can read or listen to some of the stories at www.generationpandemicproject.com. During the following school year, I decided to dive deeper into interviewing, creative writing and oral history, and I joined StoryCorps a little over a year ago.

How can people share a story with StoryCorps?
AJ: The easiest way is to download the StoryCorps app, which allows you to record your story with a conversation partner. It will automatically upload to the StoryCorps Archive and it’ll be archived in the Library of Congress, too. You can also visit StoryCorps to see whether we’re coming to your city and book an appointment to record either in-person or virtually.

In your experience, what makes a great story?
AJ: I’ve learned that there’s an important dif­ference between a good story and a good recording experience. A good story usually has a typical narrative arc, a lot of details, tension, a surprise, and something fascinating and unique. But a good recording just needs authenticity — for you to be yourself and express your feelings openly. That may involve showing gratitude, giving compliments and maybe sharing something the other person has never heard. It doesn’t have to be extraordinary. But moments where you reveal something new often make for a great recording experience.

Where can people go to listen to StoryCorps recordings?
AJ: You can find them at StoryCorps, and you can also listen to the StoryCorps podcast, which is available wherever you go to access podcasts. NPR’s Morning Edition has a weekly segment with our stories, and sometimes they’re on Weekend Edition, too. On our YouTube page we have a collection of videos that pair story recordings with animation.

Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.

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As we've passed the midpoint of the year, it's easy to drift into autopilot mode. But financial plans, like life, don't always go as expected.

A lot can shift in seven months — career changes, market moves, surprise expenses or windfalls.

If your financial plan hasn't evolved alongside you, now is a great time to check in and course-correct — particularly if you're nearing retirement.

This isn't about drastic change, but thoughtful recalibration to keep your financial strategy aligned with your goals.

The Kiplinger Building Wealth program handpicks financial advisers and business owners from around the world to share retirement, estate planning and tax strategies to preserve and grow your wealth. These experts, who never pay for inclusion on the site, include professional wealth managers, fiduciary financial planners, CPAs and lawyers. Most of them have certifications including CFP®, ChFC®, IAR, AIF®, CDFA® and more, and their stellar records can be checked through the SEC or FINRA.

Here are five high-impact steps to realign your finances, plus one bonus outside-the-box idea.

1. Update your holistic net worth

Assess where you stand. Create a centralized, easy-to-update list of assets and liabilities including checking/savings accounts, retirement and brokerage accounts, real estate, private business equity, even stock options or restricted stock units (RSUs).

The goal of this exercise is to identify patterns.

• Are you too cash-heavy?
• Is your debt-to-asset ratio creeping up?
• Have certain investments grown out of proportion to your plan?

A good general rule is that any holding that's drifted more than 5% to 10% from its target deserves review.

Don't rebalance for balance's sake — recalibrate in alignment with your goals.

For those approaching retirement, time horizon and risk tolerance are key priorities in any rebalancing.

2. Turn your tax return into a planning road map

I'm a huge advocate for the planning value contained within an annual tax return. If you haven't reviewed your 2024 return, it's not too late to leverage it to identify missed opportunities and future adjustments.

Are you maxing out retirement contributions, including catch-up contributions for those 50 and older? Did you owe taxes unexpectedly or get a large refund (which might suggest withholding is off)? Are you taking advantage of charitable deductions?

If so, you can adjust W-2 withholdings or quarterly estimated payments now, while there's still time to make a difference.

If your income is projected to be lower than usual this year, it might be an opportunity to lock in a lower tax rate on future growth by converting part of a traditional IRA or 401(k) (if permitted by the plan) to a Roth.

A Roth conversion is particularly advantageous if markets dip back down from where they are currently.

3. Stress-test your insurance and estate plan

For families, particularly those with minor children, adequate life insurance coverage is essential. But your protection strategy shouldn't stop there.

Regularly review disability coverage, umbrella liability, long-term care and homeowners' or auto policies. As your lifestyle and net worth evolve, so should your coverage.

Estate planning deserves the same attention. If you haven't revisited your estate documents in more than five years, or there's been a major life event (birth, death, divorce, remarriage), your plan might no longer reflect your intentions.

Double-check that all accounts that need beneficiaries are correct. These override your will, and they're easy to overlook because they're not all in one place.

If you haven't yet created a will or formal estate plan, now is the time. This secures your legacy and gives you peace of mind, knowing your wishes are clearly documented and loved ones are protected.

4. Recalibrate your investment strategy with purpose

As fall is just around the corner, now is an opportunity to look beyond performance and ask: "Are my investments aligned with what I want from life?" Revisit your time horizons, risk tolerance and goals.

If you haven't had a formal investment review in 12 months, schedule one with your adviser to look at:

• Asset allocation relative to life stage
• Concentrated positions that might need to be diversified
• Tax-loss harvesting opportunities

If you're within five years of retirement, consider a "pre-retirement dry run," in which you attempt to live off your expected retirement income for one to three months to test the validity of your plan, both practically and emotionally.

5. Get strategic with charitable giving and medical expenses

Late summer is a powerful planning window — far enough into the year to understand your trajectory, but with time left to make strategic moves.

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If you're philanthropically inclined but not hitting the standard deduction threshold annually, consider "bunching" multiple years' worth of gifts into one tax year.

This allows you to itemize in the current year and take the standard deduction the next. This can be done by:

• Contributing a larger sum now to a donor-advised fund (DAF). You receive the full deduction this year but can grant the funds to charities over time.
• Coordinating with your adviser to pair this with required minimum distributions (RMDs), if applicable or appreciated stock donations to avoid capital gains.

If you've already incurred significant out-of-pocket health care costs, or expect to in the second half of the year, now is the time to plan while you still have flexibility:

• If you're nearing the 7.5% of AGI threshold for itemizing medical expenses, consider prepaying for known elective procedures, dental work or long-term care premiums.
• Evaluate whether paying for a dependent's medical bills (e.g., adult children or aging parents) might qualify under the medical expense deduction or contribute toward gift tax exemptions.

One more idea: Practice purposeful planning

We often remind clients that the truest purpose of their wealth is to allow them to live intentional lives in alignment with their goals.

One small way is to begin building a "purpose fund" into your plan as a reminder of the big picture. This serves as money set aside for an experience with your family, a special gift for relatives or a one-time charitable contribution for a special cause.

A final word

Your financial life isn't just a series of accounts — it is a living, breathing system that should evolve with you. It's important to take a step back, reflect and recenter your plan around what matters most.

For those nearing retirement, checking in to make adjustments provides reassurance you're staying on track.

When your financial strategy is both technically sound and personally meaningful, it becomes more than a plan — it becomes a source of confidence, clarity and intention.

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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

Economic uncertainty, geopolitical instability, extreme weather events and the accrual of significant wealth have affected the course of charitable giving in 2025.

As we head into fall, here are five discernable philanthropy trends to watch, coupled with tips to optimize your philanthropic impact.

1. Donations will likely track stock market and economic performance

A recent report on charitable donations from Giving USA affirms the historical connection between the stock market, the performance of the broader economy and charitable giving.

"Individuals, bequests, foundations and corporations gave an estimated $592.50 billion to U.S. charities in 2024," the report says. "Total giving grew 6.3% in current dollars, reaching a new high by that measure (3.3% when adjusted for inflation).

"A strong stock market and GDP growth helped fuel the increase in total giving, which was led by individual and corporate giving."

The Kiplinger Building Wealth program handpicks financial advisers and business owners from around the world to share retirement, estate planning and tax strategies to preserve and grow your wealth. These experts, who never pay for inclusion on the site, include professional wealth managers, fiduciary financial planners, CPAs and lawyers. Most of them have certifications including CFP®, ChFC®, IAR, AIF®, CDFA® and more, and their stellar records can be checked through the SEC or FINRA.

Given this trend, a year that closes with a strong market performance would likely yield a high level of charitable giving.

Donors can prepare for this by consulting with their investment and tax advisers to earmark the optimal marketable securities to donate.

2. Donors have an increased desire to see their gifts' impact

As donors live longer, more wish to see the impact of their giving during their lifetimes, rather than leaving a bequest after death.

After providing for heirs, affluent donors increasingly view charity as a major beneficiary. This desire for current gratification and engagement has inspired donors to make meaningful gifts while they can still connect with the charities they support.

In addition, donors expecting a significant balance in their charitable vehicles upon death increasingly choose to spend down such funds to prevent future mission drift.

The inclination to accelerate giving also extends to younger generations. Newer philanthropists who have either inherited or realized significant wealth similarly wish to effect positive change sooner rather than later, especially in light of environmental and civic concerns.

At the same time, the nonprofit sector continues to struggle with greater demand for services and severely reduced government support.

3. Greater need for succession planning

As parents and grandparents age, they often wish to continue the philanthropic tradition they've started, ideally through their children and grandchildren.

With private foundations and donor-advised funds (DAFs) come the opportunity and challenge of putting these vehicles into the hands of the next generation.

Successful transitions entail a sufficient runway and planning horizon to clarify the philanthropic framework for passing the baton of charitable decision-making.

If you seek to engage your children in a common philanthropic journey, these questions can help you craft a framework to chart the future:

• How do you want your children involved in family philanthropy?
• What does success look like?
• Which family members do you wish to include in your philanthropic decision-making?
• Which causes matter most to you?
• What problems would you want to tackle as a family?
• What flexibility would you want your descendants to have over the foundation's or DAF's grants?

4. Utilizing DAFs for discretion and preliquidity planning

Donor anonymity and the ability to accept complex assets by DAFs render these vehicles a core component of an affluent donor's charitable planning.

As the cultural climate becomes more controversial, affluent donors seek privacy for themselves and their families to avoid unwanted solicitations and prevent public scrutiny, especially when addressing sensitive issues.

As a planning consideration, DAFs enable donors to give anonymously, enabling them to maintain discretion around their philanthropy.

Interests in either privately held or publicly traded companies might constitute one of the most valuable assets owned by high-net-worth individuals.

• While the early growth stage of a company reflects an optimal time to transfer wealth to family members (or vehicles for their benefit), assets that have risen in value become more attractive for charitable giving.
• Donors typically reduce their tax liabilities by donating some or all of their after-tax proceeds to charity. However, an additional benefit lies in donating long-term appreciated capital assets before a liquidity event. Doing so not only yields a charitable deduction, but also a reduction in capital gains tax exposure.
• With careful planning, the donor would not recognize any capital gains on the charity's subsequent sale of the donated asset. Donors should consult with counsel to review opportunities for their particular tax profile and any risks of a potential anticipatory assignment of income.

5. Complementing charitable giving with political advocacy

Recent election cycles and the impact of elected officials on critical issues have heightened the awareness of many philanthropists of the ability to effect change through civic and political engagement, as well as charitable donations.

Section 501(c)(4) organizations have emerged as a structure for those who wish to engage in certain forms of advocacy that are more challenging, or prohibited, for charitable 501(c)(3) organizations.

Section 501(c)(3) organizations by law cannot support or oppose candidates for elected public office and must only engage in nonpartisan advocacy.

On the other hand, 501(c)(4)s can engage in some partisan activity (but partisan political activity cannot be the primary purpose of a 501(c)(4) organization).

Like charitable 501(c)(3) organizations, 501(c)(4) entities are tax-exempt. However, unlike charitable donations, contributions to 501(c)(4) entities are not income-tax-deductible.

Funders of 501(c)(4) entities must comply with both federal and state laws, and would need to consult with counsel to fully understand their options for achieving their desired community and societal impact.

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Deploying significant philanthropic capital quickly and effectively can feel like a daunting task. Fortunately, you can support causes through certain steps, including:

Review with your tax adviser the maximum amount that you can deduct this year, based on your total anticipated adjusted gross income (AGI) for 2025.

• Itemized deductions of cash to public charities remain limited to 60% of AGI each year, compared with the 30% of AGI limit for donations of long-term appreciated capital gain property to public charities.
• Donating long-term appreciated marketable securities might provide for greater tax efficiency, however, so reviewing the optimal assets to donate remains critical for optimal tax planning.
• You can carry forward the excess deduction to the subsequent five tax years. If you choose to donate more than you can ultimately deduct, having this framework in mind can inform your charitable budget for current and future years.

Within your desired charitable budget, consider increasing funding to charities you have been happy to support. Given the likelihood of greater need for the services these charities provide, you can increase your impact accordingly by further funding the work that you've already observed.

Prioritize general operating support, as opposed to restricted funding for specific projects. General operating support enables charities to respond to emergencies and quickly pivot to the greatest needs as they arise. It also can strengthen the charity in the long run by investing in much-needed technology, strategic planning or other long-term needs.

Consider multiyear grants to provide charities some fiscal stability and the ability to metabolize capital at a more manageable rate. Funding over several years can also enable charities to respond to ever-evolving challenges posed by eternal factors.

Consider intermediary organizations that research effective organizations in your areas of interest. You can leverage their information and networks to expedite your own due diligence in identifying charities already making an impact in the areas you care most about.

Giving Compass, The Center for High Impact Philanthropy and other charitable research platforms can help identify such organizations, based on the specific issues you search for within their websites.

Conclusion

In 2025, affluent donors face a dynamic philanthropic landscape shaped by economic uncertainty, global instability and rising needs.

Giving will likely mirror market performance, so plan charitable gifts with your tax adviser to maximize deductions — especially by donating appreciated securities or using donor-advised funds for privacy and flexibility.

Donors increasingly seek to give while living, engage family in succession planning and support charities with general operating grants and multiyear commitments. Political advocacy is also gaining traction, though it requires special legal consideration.

Plan now to make an impact on the areas you value and prioritize.

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• How to Assess the Impact of Your Charitable Giving
• Three Charitable Giving Strategies for High-Net-Worth Individuals
• What Can a Donor-Advised Fund Do for You? (A Lot)
• In Family Philanthropy, Embracing Differences Can Pay Off

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

The first half of 2025 was marked by significant market uncertainty, creating concern for even the most level-headed investors and donors.

Most charitable giving and investment strategies account for natural market cycles, but hyper market fluctuations in recent months have created additional ambiguity that can be hard to plan for — and even harder to ignore.

The reality is the need for strategic charitable giving is often even greater during periods of market fluctuations or a downturn.

The Kiplinger Building Wealth program handpicks financial advisers and business owners from around the world to share retirement, estate planning and tax strategies to preserve and grow your wealth. These experts, who never pay for inclusion on the site, include professional wealth managers, fiduciary financial planners, CPAs and lawyers. Most of them have certifications including CFP®, ChFC®, IAR, AIF®, CDFA® and more, and their stellar records can be checked through the SEC or FINRA.

Nonprofits face many of the same uncertainties as investors and donors.

With the recent passage of the One Big Beautiful Bill Act, more dynamics could be tacked on to giving decisions in the year ahead.

In many sectors, the challenges are multifold: Nonprofits are grappling with the possible loss of funding streams as well as a potential dip in charitable giving.

At the same time, many charitable causes are seeing an increased need for their work.

Fortunately, with the right approach, investors and charitably minded individuals can maintain — and often enhance — their giving and impact during turbulent markets.

Here's a closer look at some strategies to consider.

1. Choose the right giving strategy

It might seem simple, but creating a budget or plan and sticking to it has proven to be a tried-and-true strategy to withstand shifting market dynamics.

There is significant power and value in budgeting, especially as it pertains to charitable giving. To be successful, investors must be clear on:

• What causes they want to support
• How they're going to fund grants
• Crafting an investment strategy that fits

For many donors, a donor-advised fund (DAF) is the ultimate philanthropic planning and budgeting vehicle. When it comes to charitable giving in times of uncertainty, DAFs offer several advantages that can help donors maintain their impact.

Most notably, a DAF separates the initial charitable contribution from the grant to the nonprofit. This means donors can budget and make a plan to increase contributions during periods of strong performance and maintain grantmaking should the market turn.

This consistency is vital in ensuring nonprofits benefit from regular, recurring contributions and offers donors the flexibility to adjust their giving to respond to specific needs.

2. Take a broad portfolio view

Turbulent markets will impact a portion of most investors' and donors' assets, making it a good time to review the full portfolio and make strategic investment and giving decisions that run counter to or can withstand fluctuations in the stock market.

For example, is now the right time to consider donating complex, illiquid assets, such as a hedge fund interest, private equity or a real estate holding to charity? Should you ensure charitable assets are invested in both public and private options, such as Vanguard's Hamilton Lane Private Asset Fund? (Note: I am the CFO of Vanguard Charitable.)

3. Prioritize unrestricted giving

The message from nonprofits is clear: They prefer having control of how to allocate the assets that are granted to them.

In the last decade, there has been a marked shift in donor mindsets around the "overhead myth." Today, donors are more likely to give money without restrictions, placing greater trust in the experts at the nonprofits they support to utilize donations and assets to their greatest potential and carry out their mission.

Unrestricted giving is becoming more common across charitable efforts, but it's especially crucial as a part of unexpected giving.

During periods of uncertainty, the need for unrestricted giving can be even greater, as charities might face unique or unexpected challenges and costs.

The silver lining for nonprofits is that donors with money already earmarked for charity are more likely to step up and meet these moments.

According to Vanguard Charitable research, donors who use a Vanguard Charitable DAF for unexpected granting gave 39% more than those who use a DAF only for expected, ongoing giving, resulting in nearly 48% of total grants issued in 2024 being unrestricted.

4. Consider recoverable grants

A recoverable grant is another giving approach that could be utilized in periods of uncertainty.

The gift can be structured similarly to a bridge loan, in which a nonprofit could use a contribution to maintain cash flow and cover expenses while other funding might be in limbo.

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If that funding is secured, the grant could be repaid to the donor's account, or it could be repurposed into other activities, depending on the specific situation and the donor's preferences.

5. Stay the course

As is often the case with investing and financial management, one of the best things to do during market unpredictability is to trust your strategy.

All good charitable giving plans and investment strategies account for such conditions and are designed to weather downturns.

It might be worth a quick review of that plan to ensure the strategy and allocations are still aligned with long-term goals, but drastic changes are rarely necessary — nor effective.

Research has consistently shown that attempts to time the market often backfire.

Taking stock in the strategy work done to date and relying on the right plan and partner is often the best course in times of uncertainty.

Related Content

• Developing a Charitable Giving Strategy: Where to Begin
• How to Assess the Impact of Your Charitable Giving
• How Charitable Donations Can Reduce Your Taxes
• Investing for Charitable Giving: Discipline Reaps Rewards
• Donating Complex Assets Doesn't Have to Be Complicated

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.

President Donald Trump signed the One Big Beautiful Bill into law on the Fourth of July. Here are some of the changes in the tax legislation and how they could affect wealthy retirees.

(Because I don't think I have the stamina to continue to write out the full name of the law, from here on out, I'll use OBBB.)

Our clients are retired, or are nearing retirement, and typically have $2 million to $10 million invested with us. They are willing to pay their fair share of taxes, but do not want to pay a dollar more. If you're in that camp, this column is for you.

The Kiplinger Building Wealth program handpicks financial advisers and business owners from around the world to share retirement, estate planning and tax strategies to preserve and grow your wealth. These experts, who never pay for inclusion on the site, include professional wealth managers, fiduciary financial planners, CPAs and lawyers. Most of them have certifications including CFP®, ChFC®, IAR, AIF®, CDFA® and more, and their stellar records can be checked through the SEC or FINRA.

1. Change: Marginal tax rates remain the same

How could an article about changes in tax law start with something that's staying the same? Trump's last tax bill, the TCJA in 2017, made tax cuts permanent at the business level, but they were temporary at the personal level. We were set to see a reversion to the older, higher marginal rates on January 1, 2026. No more.

What this translated to in conversations with clients was always an "if this, then that." It just added uncertainty to tax planning done with an eye toward the future.

Of course, "permanent" in Washington is never "actually permanent," but now we at least know what rates will be next year, which makes our planning more accurate.

Strategy: Roth conversions up to the 24% bracket.

No, not everyone should convert up to the 24% bracket, but many of our clients have quite large required minimum distributions (RMDs) that, when paired with Social Security benefits and other income sources, could boost them into the 30% rates in their 70s.

Here are the 2025 tax rates for single filers and those who are married and filing jointly:

That jump from 24% to 32% hurts, but the 24% bracket is wide. Many of our clients are and will continue to fill up that 24% bracket with their Roth conversions until their RMD age (73 or 75, depending on their birth year) in order to avoid big tax spikes later in life.

2. Change: SALT cap increased to $40,000 from $10,000

There are some significant exceptions for the SALT cap (which allows taxpayers who itemize to subtract certain state and local taxes from their federal taxable income).

First, it sunsets in 2029 (meaning it's temporary).

Second, it's got an income cap. The $40,000 SALT deduction declines when taxable income gets above $500,000 and reverts all the way back to $10,000 at $600,000 of taxable income.

This means that for our clients who are in this income range and who itemize deductions, we will be paying a lot of attention to those thresholds, just as we do with capital gains, income tax and Medicare brackets.

Strategy: All else being equal, you will get more bang for your charitable buck from 2025-2029 than you will in 2030, when this has expired. If it expires.

That means that you should maximize giving during these years if the SALT cap gets you closer to the standard deduction hurdle, and therefore, more of your giving gets you an actual tax benefit.

This one will be very personal, as the size of the gift and your future tax rates could actually make the opposite strategy make sense. We run tax projections for all clients using planning software. You can access a free version online.

3. Change: $2,000/$1,000 (MFJ/single) charitable deduction

If you don't clear the standard deduction hurdle but give to charity, this is good news for you. This will allow couples who do not itemize to deduct up to $2,000 in cash contributions to qualified charities.

If this sounds familiar, it's because there was a very similar provision in the CARES Act in 2020 and 2021.

Strategy: Larger gifts to fund trusts should likely still be done with appreciated securities. Gifts for those over age 70½ should probably still be done via a qualified charitable distribution (QCD).

However, this is good for those who are in their 50s and 60s and give smaller amounts in cash but don't typically get a benefit from it. You should no longer hesitate to swipe that card or write that check when you donate, up to the $2,000 per couple.

Also, tucked into this bill was a charitable giving hurdle for itemized gifts. Think medical expense deductions, which are only deductible as they get above 7.5% of AGI. With charitable giving, the hurdle is 0.5%.

So, if your AGI is $100,000, the first $500 of your giving is not deductible, meaning the giving for those who do not itemize is even more advantageous.

4. Change: Extra deduction of $6,000 per taxpayer over 65

If you got an email from the Social Security Administration over the holiday weekend touting this bill as the greatest thing since sliced bread because it eliminates income taxes on Social Security for 90% of beneficiaries, it's because of this change.

Trump campaigned on eliminating taxes on Social Security. This is not that. However, because it will bring the standard deduction to about $45,000 for a married couple who are both over 65, it means that most beneficiaries will not pay income taxes on Social Security.

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Unfortunately, or fortunately, our clients will be in the group still paying taxes due to other income sources. It also must be noted that this, too, will expire — this bonus deduction goes away after 2028.

Strategy: If you are between 65 and 73 and your income is below $300,000/$150,000 (MFJ/single), you're in luck. That is the threshold above which the bonus deduction goes away.

Other bonuses of this change: more room to do Roth conversions at lower tax rates, and we are looking at recognizing capital gains without any tax if you are in the 12% bracket or below.

5. Change: Estate tax exemption is going to be $15 million next year

Like the sunset of the current marginal tax brackets, the large estate tax exemptions that we have grown accustomed to were set to sunset at the end of this year.

The estate tax exemption was scheduled to come down to $7 million per person in 2026. Instead, it will be $15 million per person because of the OBBB.

This means that taxable estates need not worry about estate taxes below these thresholds. This does not mean that a couple can pass $30 million to their kids without taxes. You still need to consider income taxes and capital gains taxes.

Strategy: Estate planning will remain more about control, efficiency and income and capital gains taxes than it will be about estate taxes.

This means that very few people will need to implement irrevocable trusts to keep their taxable estates below the thresholds.

If you don't care about leaving a legacy to individuals, don't hesitate to spend Roth and taxable dollars. Charitable giving should be done via pretax accounts.

If you do want to leave a legacy to your kids, Roth conversions and spending down retirement accounts will probably be your best bet.

Taxable and Roth accounts and life insurance will be the most tax-friendly vehicles to leave to the next generation.

This bill came in just under 900 pages. You would have to read exactly zero pages to know that Elon Musk was not happy with it.

While his public gripes were mostly around the skyrocketing debt, I'm sure he wasn't happy with the electric vehicle credits, which actually get eliminated even sooner than expected in the final bill.

Whether you're Team Elon, Team Trump or team anyone else, if you're planning on purchasing an electric vehicle, you'll want to do that before September 30, 2025.

Related Content

• Trump's 'One Big, Beautiful Bill' With Trillions in Tax Cuts: What to Know
• No SS Tax Cuts in The 'One Big Beautiful Bill': What Retirees Need to Know
• Why Elon Musk and Most Americans Don't Like Trump's Big Bill
• How the One Big Beautiful Bill Act Will Reshape 529 Plans
• Big GOP Tax Bill Could Change Your Estate Planning for 2025

This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.