Bunch Multiple Years of Charitable Gifts, Increase Your 2025 Tax Benefits

As the end of the year approaches, many philanthropic donors are thinking about their charitable giving.

If you regularly give to nonprofits every year, there’s a powerful tax strategy you may be overlooking: bunching charitable contributions.

Done correctly and before December 31, when you bunch multiple years of charitable gifts into one year, you can significantly reduce your taxes while still supporting the causes you care about.

What Is Charitable Gift Bunching?*

Charitable gift bunching refers to combining multiple years’ worth of charitable donations into a single tax year instead of spreading them out annually. For example, rather than donating $5,000 each year for the next three years, you might donate $15,000 in one year and pause giving in the following two years.

Why does this matter? Because of how the tax code treats deductions.

The Standard Deduction vs. Itemizing

After the standard deduction for federal tax returns was increased in recent years, many taxpayers no longer itemize their deductions because they cannot exceed the standard deduction "hurdle." If you take the standard deduction on your federal tax return, your charitable gifts generally don’t reduce your taxable income.

However, if your total itemized deductions—including charitable contributions, mortgage interest, and state and local taxes—exceed the standard deduction, itemizing becomes worthwhile.

Bunching donations can push your itemized deductions above the standard deduction threshold in one year, allowing you to claim a tax benefit that you might otherwise miss if your donations were spread out over multiple years.

Why Timing Matters: December 31

Charitable contributions must be made by December 31 to count for that tax year.

That means the donation check must be mailed, the credit card charge processed, or the transfer of appreciated assets completed before year-end. (Note that qualified charitable deductions, or QCDs, from your IRA if you're at least 70 1/2 years old do not apply to bunching gifts since you do not take income in this type of transaction.)

Waiting until January means losing the opportunity to claim the deduction for the current year—along with the tax savings that come with it.

Tools That Make Bunching Easier

Many donors use donor advised funds (DAFs) managed by the Jewish Community Foundation to make bunching simple.

With a DAF from the JCF, you can contribute a large amount in one year (and claim the deduction immediately), then recommend grants to charities over future months or years at your own pace. This allows nonprofits to receive steady support while you maximize your tax efficiency. Plus, while the initial donation remains in the DAF, the fund balance is professionally-invested and can potentially grow tax-free, allowing you to give even more than you originally planned.

The Bottom Line

Bunching charitable gifts is a smart way to align generosity with tax planning.

By consolidating multiple years of giving into one year—before December 31—you may unlock deductions that lower your taxable income and increase your overall impact.

If you would like to learn more and discuss your philanthropy, please contact JCF Executive Director David Snyder at 856-673-2571 or dsnyder@jfedsnj.org.

As always, consult with a tax professional to ensure this strategy fits your personal situation, but don’t overlook the potential savings that thoughtful timing can deliver.

We hope this helps your charitable giving plans a whole bunch.

*This is for informational purposes only and should not be construed as legal, tax, or financial advice. Please consult with your trusted advisor for more information.

Disclaimer: This post used AI for outlining/drafting and was edited by JCF staff.