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2023 Charitable Contribution Limit and Your 2024 Giving Plans

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The Signatry

February 28, 2024

As we prepare for tax season, we look back at our charitable contributions in 2023 to determine what kind of charitable tax deductions we may get. Looking back on our giving habits in 2023 also allows us to look forward to 2024—what we might do differently or where we might give more. The information below can help you understand 2023 charitable contribution limits and deductions. Plus, discover how you can adjust your generosity strategy to minimize tax liability and maximize your generosity in 2024.

2023 Charitable Contribution Limits: How much giving is deductible?

Tax benefits for charitable contributions: 2023 tax law offers charitable deductions to donors who itemize taxes and contribute cash or appreciated non-cash assets (make sure to hold them for more than a year before donating). So, what was the charitable contribution limit in 2023?

The annual exclusion for gifts increases to $17,000 for calendar year 2023, up from $16,000 for calendar year 2022.

The charitable contribution limit for a gift of cash to a public charity or donor advised fund remains 60% of one’s adjusted gross income (AGI). Donors may claim a tax deduction for non-cash asset gifts to qualified public charities and donor advised funds up to 30% of their AGI. Donation amounts in excess of these limits may be carried over for up to five tax years.

Should You Itemize? 2023 Standard Deduction

The standard deduction for married couples filing jointly for tax year 2023 rises to $27,700, up from $25,900 the prior year.

For single taxpayers and married individuals filing separately, the standard deduction rises to $13,850 for 2023, up from $12,950 the prior year.

And for heads of household, the standard deduction will be $20,800 for tax year 2023, up from $19,400 for tax year 2022.

Giving More in 2024

Stocks and Charitable Giving

  • Appreciated stocks donated to a donor advised fund before they are sold do not affect the donor’s capital gains taxes. Donating appreciated stocks before they sell is another strategy to minimize tax burden and maximize generosity. Learn more here.

Give Appreciated Non-cash Assets Instead of Cash

  • For those who itemize deductions, giving capital assets such as stock, cryptocurrency, real estate, or business interest to a donor advised fund may maximize your generosity and minimize taxes. Beyond claiming a deduction for the fair market value of an asset, donors can avoid the capital gains tax they would otherwise incur if they sold the asset and then donated the cash proceeds. This can mean even more going to charity and less to taxes.

Leverage Deduction Rules or a Bunching Strategy

  • Bunch contributions. If your tax deductions do not always surpass the standard deduction threshold, charitable bunching may be beneficial. Bunching charitable donations means donating two years’ worth of your expected contributions to a donor advised fund in a single year.
    For example, if you increase your donations in 2024, you may choose to itemize deductions on 2024 taxes and take the standard deduction on 2025 taxes. In addition to achieving a large charitable impact now, this strategy could produce a greater total deduction across the two years, depending on your contribution amounts and filing status. With a donor advised fund, you can recommend a schedule of gifts to go out across the two years and add any additional amounts from the itemized 2024 return as bonus gifts to charities.

Consider Retirement Assets

  • Make a Qualified Charitable Distribution (QCD) of IRA assets. Individuals age 70½ and older can direct up to $100,000 per year, tax-free, from their Individual Retirement Accounts (IRAs) to operating charities through qualified charitable distributions (QCDs). A QCD satisfies your RMD requirement for the year, and by reducing your IRA balance, a QCD may also reduce your required minimum distribution (RMD) in future years, lower your taxable estate, and limit your beneficiaries’ tax liability. A donor advised fund is not an eligible recipient of a QCD—a distribution from your IRA to a DAF will not be tax-free. The Signatry offers other giving methods that may receive a QCD, including designated funds. Grants from a designated fund can only be sent to a single charity. Learn more here.

Explore How A Donor Advised Fund Can Help

Discover why and how a donor advised fund can help you minimize your tax liability while maximizing your generosity toward causes you love most.

Learn More About Donor Advised Funds

About The Signatry

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The Signatry seeks to inspire and facilitate revolutionary biblical generosity across generations. Through donor advised funds and other innovative tools and resources, families are empowered to live generously, modeling biblical values for future generations and making a greater impact for causes that align with their passions. Since its founding in 2000, The Signatry has facilitated sending over $4 billion to organizations around the world that are dedicated to solving the world’s greatest problems.

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