Timing is everything: Mapping out clients’ 2025 charitable giving plans

by SCF Team | August 1, 2025 | Siouxland Community Foundation Blog, Advisor Resources |

It’s never been easy to navigate the ever-shifting tax rules to help clients structure charitable gifts, and now it’s even trickier. Major changes under the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, are creating complexity, opportunity, and, for some, urgency. The OBBBA reshapes both how much a client can deduct for charitable contributions and which clients can benefit from these deductions in the first place. Indeed, your clients might have read a recent Wall Street Journal article (subscription required) outlining major tax planning themes related to charitable giving.

As always, the team at the community foundation is honored to be your first call when the topic of charitable giving arises in client conversations. In most cases, our tools can be useful, and if we can’t help directly, we’ll point you in the right direction.

Here are some key issues to discuss with philanthropic clients:

Bunching Contributions

The standard deduction has increased to $15,750 for single filers and $31,500 for joint filers in 2025, with even higher levels for those aged 65 and older. A popular approach for many clients is bunching—making multiple years’ worth of charitable contributions in 2025 into a donor-advised fund. This allows them to itemize and maximize deductions now, while distributing funds to charities in future years.

Leveraging the Endow Iowa Tax Credit

The Endow Iowa Tax Credit offers a 25% state tax credit for gifts to qualified permanent endowment funds, in addition to federal charitable deductions. Since the credit is not tied to itemization rules and is capped annually, early planning is critical for securing this benefit.

Preparing for 2026 Deduction Limits

Starting in 2026, only charitable donations exceeding 0.5% of AGI will be deductible, and deductions for high-income taxpayers will be capped at the 35% rate instead of 37%. These changes may reduce the benefits of charitable giving for many clients, making front-loading donations in 2025 particularly advantageous.

Deduction for Non-Itemizers

Also beginning in 2026, taxpayers taking the standard deduction may claim up to $1,000 (single) or $2,000 (joint) for cash gifts to qualifying public charities. While donor-advised funds and non-cash gifts are excluded, this provision opens opportunities for the many Americans who don’t itemize.

2025 is a pivotal year for charitable giving. Reach out to our team to explore strategies tailored to your clients’ needs.