Gift of Giving: Charitable Contributions and Your Wallet

Charitable giving connects generosity with financial savvy, creating a powerful impact on communities and personal finances alike.

Understanding current trends, tax law changes, and donor strategies can help you maximize both your philanthropic reach and your wallet’s benefits.

Recent U.S. Charitable Giving Trends

In 2024, Americans donated a record $592.50 billion, up 6.3% year-over-year and driven by economic growth and strong markets. Daily giving averaged over $1.62 billion, showcasing the public’s generosity.

Individuals accounted for 66–74% of total contributions, donating $392.45 billion. Corporate giving rose to $21.08 billion, a 3.4% increase overall, often boosted by matching gift programs.

• Religion: 23% of total giving ($146.54 billion)
• Human services and education: 14% and 13–14%, respectively
• Health and foundations: around 10–11% each

Donor-advised funds have surged: Fidelity Charitable grants hit $14.9 billion in 2024, a 25% increase year-over-year, benefiting over 433,000 nonprofits.

Tax Law Changes Impacting Deductions

Starting in 2026, new rules reshape tax benefits for donors, distinguishing between itemizers and non-itemizers. The non-itemizer deduction up to $1,000 for singles ($2,000 for couples) will apply only to cash gifts.

Itemizers face a deduction floor of 0.5% of AGI, meaning contributions below that threshold yield no tax benefit. High earners will see a deduction cap of 35% of AGI, down from 37%, reducing the effective write-off on large gifts.

Example: A high-income donor with $300,000 AGI must exceed $1,500 in donations before deductions apply, and a $1,000 gift yields only a $350 deduction under the new 35% cap.

Donor Profiles and Patterns

The average U.S. donor is 64 years old and gives twice a year, with one-time gifts averaging $121 and monthly gifts at $25. Recurring programs now include 57% of donors, up from 46%.

End-of-year generosity remains strong: 17–33% of donations occur in December, often driven by tax planning and festive spirit. Thirty-three percent of donors support causes outside their own state or country, reflecting a global mindset.

• Workplace giving and matching gifts: over 9% participation
• Major gifts ($1M+): five times more frequent than a decade ago
• Disaster relief responsiveness: nearly $50 million for hurricane aid

Strategies for Tax-Smart Giving

To maximize your impact and tax savings, consider these practical approaches. Bunching donations into alternate years can help itemizers surpass the AGI floor. Donor-advised funds allow you to bundle contributions and grant strategically.

Gifting appreciated securities often offers dual benefits: you avoid capital gains tax and deduct the asset’s full market value. IRA charitable rollovers let individuals over 70½ donate up to $100,000 directly from retirement accounts without additional taxable income.

• Use donor-advised funds for bunching contributions and tailored grantmaking.
• Donate appreciated stocks to avoid capital gains and get full value.
• IRA charitable rollovers up to $100,000 for those over 70½.

The Big Picture: Community Impact and Outlook

Charitable giving is more than a tax tool; it’s a driver of social change. In 2024, six of nine nonprofit subsectors exceeded pre-pandemic levels, proving resilience and growth.

Donors remain optimistic: those expecting to give the same or more in 2025 rose, while only 14% plan to give less. This optimism underpins a shift toward “giving while living,” with donors actively engaged in causes they care about.

Whether through small recurring gifts or transformative major grants, your philanthropy shapes communities, supports vital services, and strengthens social bonds. By aligning charitable contributions with informed tax strategies, you can expand your impact and keep more dollars working for the causes you value.

Embrace generosity with financial insight—it’s a gift that benefits others and your own fiscal well-being.