Most people who give to charity do so because they care, about a cause, a community, an institution that has meant something to them. The giving itself is the point. But how you give matters almost as much as how much you give, and November is the month when that distinction becomes financially significant. The decisions made before December 31 determine whether your generosity also works as a planning tool in reducing taxes, satisfying retirement account obligations, and stretching each dollar further for the organizations you care about most.
The good news is that the most effective giving strategies are not complicated. They simply require a little intentionality before the calendar turns.
Why the Standard Deduction Changes Everything
The 2026 standard deduction is $32,200 for married couples filing jointly and $16,100 for single filers, which is among the highest in history. For most Americans, this means their charitable donations provide no direct tax benefit at all. If your total itemized deductions, including state and local taxes, mortgage interest, and charitable gifts, do not exceed the standard deduction, you are effectively donating after-tax dollars with no additional tax relief.¹
That is not a reason to stop giving. It is a reason to give more strategically.
Bunching: Turning Two Years of Giving Into One Powerful Deduction
One of the most effective responses to the high standard deduction is bunching: concentrating two or more years of planned charitable contributions into a single tax year, then taking the standard deduction in the years that follow. By front-loading giving, you can push your itemized deductions above the standard deduction threshold in the “on” year and maximize the tax benefit of gifts you were already planning to make.
The most practical vehicle for bunching is a donor-advised fund, or DAF. A DAF allows you to make a large, deductible contribution in one year, receiving the tax deduction immediately, and then recommend grants to your chosen charities over time, with no requirement that grants be distributed in the same year. You give when it makes the most tax sense; your charities receive the support when they need it.¹
This structure is particularly valuable in high-income years, maybe a year when you receive a bonus, a business sale or a large Roth conversion, when the deduction has the most value and there is genuine urgency to reduce taxable income before year-end.
Donating Appreciated Securities: A Better Alternative to Cash
For donors who hold stocks, mutual funds, or other securities that have increased in value, donating those assets directly to a charity or donor-advised fund is almost always more tax-efficient than selling them and donating the proceeds.
Here is why: when you donate appreciated securities held for more than one year, you avoid paying capital gains tax on the appreciation entirely, and you receive a charitable deduction for the full fair market value of the securities at the time of the gift.² A donor who sells $20,000 worth of appreciated stock first, triggering capital gains, and then donates the after-tax proceeds effectively gives less than the donor who transfers the shares directly. The charity receives the same value either way, but the direct transfer costs the donor less.
The same logic applies to contributions to a donor-advised fund. One transfer of appreciated shares can fund multiple years of charitable giving, all while eliminating the embedded capital gain.
Qualified Charitable Distributions: The Most Powerful Tool for Retirees
For investors aged 70½ or older, a Qualified Charitable Distribution, a direct transfer from a traditional IRA to a qualified public charity, is one of the most tax-efficient giving strategies available, full stop. The 2026 QCD limit is $111,000 per person.³
What makes the QCD uniquely powerful is that the distributed amount is excluded from taxable income entirely. For a retiree who takes the standard deduction and would not otherwise benefit from itemizing, the QCD delivers a tax benefit that a cash donation followed by a deduction cannot replicate. The QCD also counts toward satisfying the year’s required minimum distribution, which means it simultaneously fulfills a mandatory obligation while reducing the taxable income that drives Medicare premium surcharges, Social Security taxation, and bracket positioning.
One important detail: a QCD must be transferred directly from the IRA custodian to the charity. It cannot pass through the account holder’s hands first, and it cannot be directed to a donor-advised fund or a private foundation. The contribution must go to a qualifying public charity.³
One New Wrinkle for 2026: The 0.5% AGI Floor
The One Big Beautiful Bill Act introduced a new limitation for higher-income donors: charitable deductions for itemizers are now subject to a 0.5% of Adjusted Gross Income floor, meaning the first 0.5% of AGI in charitable contributions generates no deduction at all. For a household with $500,000 of AGI, the first $2,500 in charitable gifts is effectively non-deductible under the new rule.⁴
This change makes the QCD, which operates entirely outside the itemized deduction system, relatively more attractive for eligible retirees, since it is unaffected by either the floor or the standard deduction threshold. For donors who are not yet eligible for QCDs, the DAF and appreciated securities strategies remain fully effective.
Timing Matters More Than Most People Realize
November is the right month to finalize charitable giving decisions for a practical reason: processing takes time. Transferring appreciated securities to a charity or donor-advised fund can take one to two weeks. QCDs must be initiated and received by the charity before December 31 to count for the tax year, and year-end transaction volumes at custodians can slow processing times. Waiting until December to start the conversation is waiting too long.
Bottom Line: Charitable giving is one of the few areas of financial planning where doing things more thoughtfully costs nothing and benefits everyone — the donor, the charity, and the broader plan. Whether through a donor-advised fund, appreciated securities, or a QCD from an IRA, the strategies available in 2026 allow generous people to give more effectively. Your Wedbush advisor can help you identify which approach fits your situation and ensure the mechanics are in place before year-end.
Sources:
- https://www.medicare.gov/health-drug-plans/open-enrollment
- https://taxusanow.com/blog/tax-strategies-for-high-earners/
- https://www.windwardfp.com/wealth-insights/charitable-giving-2026
- https://www.dafgiving360.org/bunching-charitable-contributions
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