As the calendar year draws to a close, you’re likely well aware that charitable giving is not only important to your clients as an act of generosity, but for tax planning purposes.  

 Consider the following easy solutions to common hypothetical client situations:

You want to help Emily Harper benefit from itemizing deductions.

Your client, Dr. Emily Harper, a 62-year-old physician, has long supported many local charities with annual donations totaling around $20,000. While generous, her giving has not exceeded the standard deduction under the current tax law, which means she has received little to no tax benefit for her contributions. You’ve counseled Emily that 2026 will bring even more limitations on her ability to deduct charitable contributions.

This December, you work with the North Carolina Community Foundation to help Emily establish a donor advised fund with a contribution of $100,000 of appreciated stock. This large, single-year contribution will allow her to itemize deductions for 2025 and maximize her tax savings, while still preserving the flexibility to recommend grants of $20,000 per year to her favorite charities over the next five years. By front-loading her philanthropy, Emily not only secured a significant deduction even under the higher standard deduction thresholds in place, but she also avoided potential exposure to the upcoming IRS “floor and cap” rules under the One Big Beautiful Bill Act.

You are worried about Jonathan Lee’s concentrated stock positions.

Jonathan Lee, a 58-year-old business executive, has accumulated a significant position in a favorite stock over the past two decades. As Jonathan’s advisor, you have grown increasingly concerned about the concentration risk in his portfolio and the steep capital gains tax bill he would face if he sold shares outright. You also discovered that Jonathan has consistently supported a handful of local charities with annual cash gifts.

Working with NCCF, you arranged for Jonathan to donate $250,000 worth of his highly-appreciated stock to establish a donor advised fund. This move accomplished two critical objectives: it allowed Jonathan to bypass the capital gains tax on the gifted shares and made him eligible for a full fair-market-value charitable deduction for the stock’s value on the date of the gift. Now, instead of writing annual checks from after-tax dollars, Jonathan can recommend grants from his donor advised fund over time, maintaining his giving pattern while enjoying significant tax efficiency. What’s more, by contributing stock instead of cash, Jonathan transformed a concentrated holding into diversified charitable capital.

Margaret Davis has more money in her IRAs than she’ll ever need.

Your client, Margaret Davis, is 74 years old. She continues to receive royalty income from several books she wrote over the course of her career as a novelist. Her royalties are more than enough to cover her living expenses. She also owns several IRAs, but she does not need the Required Minimum Distributions (RMD) to supplement the income she receives from royalties. You have counseled her, though, that she has to take those distributions under IRS rules. 

Margaret is a steadfast volunteer at her local animal shelter and has been making cash contributions to support their work for years. Because she is over 70 ½ years old, you know Margaret can direct up to $108,000 in Qualified Charitable Distribution (QCD) in 2025 to qualified charities. You know Margaret cannot use QCD dollars to fund a donor advised fund, but you don’t know what other options are available to support the animal shelter.   

You reach out to NCCF for help, and you’re glad you did because the team has shared two ways Margaret can use her QCD dollars to support the animal shelter. First, Margaret can use all or a portion of her QCD to contribute directly to the animal shelter; and second, Margaret can use all or a portion of her QCD to establish a designated fund at NCCF to support the animal shelter. The designated fund will support the local animal shelter with annual distributions now and in the future, even after Margaret dies. The QCD dollars are excluded from Margaret’s income and still satisfy all or a portion of her RMD. 

If your client base includes people like Emily, Jonathan, and Margaret, please give us a call! NCCF is here to help you help your clients fulfill their charitable objectives, making our community and the lives of the people who live here even better for generations to come. 

This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice.