(This article originally appeared in the November 2024 issue of Military Officer, a magazine available to all MOAA Premium and Life members. Learn more about the magazine here; learn more about joining MOAA here.)

Our nation is a charitable one: In 2023, Americans donated over $557 billion to charity, according to an annual report published by the Giving USA Foundation.

As the end of the year approaches, you might want to consider gifting strategies that will allow you to be generous to your favorite cause while also potentially saving on your tax bill.

[MOAA CHARITIES: Ways to Donate | URGENT: Donate to Our Crisis Relief Program]

Generally, if you want to deduct charitable contributions on your taxes, you must itemize deductions on Schedule A of IRS Form 1040 and you must donate to a qualified charitable organization.

Cash contributions may be deducted up to 60% of adjusted gross income (AGI), and limits on noncash contributions and contributions to private charities generally range from 30% to 50%.

According to the IRS, about 10% of taxpayers are likely to itemize their deductions. This means that many people are missing out on benefiting from their charitable contributions, and it means you might have to be strategic when it comes to how you give.

[RELATED: 2025 Federal Income Tax Brackets Reflect Low Inflation Levels]

There are many options for charitable giving. The simplest way is to send a check, but that might be less efficient from an income tax perspective. Here are some tax-efficient ways to give.

Donate Appreciated Assets

If you sell securities such as stocks or bonds that have appreciated in value, you would owe capital gains tax on the growth.

But if you gift them to a charity, both you and the charity avoid the tax, and you would be eligible for a charitable income tax deduction equal to the fair market value of the asset up to 30% of your AGI.

[RELATED: 5 Money Moves to Make When Interest Rates Are Falling]

Donate From Your IRA

If you are at least age 70½, you can donate directly from your individual retirement account (IRA) to charity. While you can’t take a charitable deduction for a qualified charitable distribution (QCD) on your taxes, the gift amount won’t be considered taxable income, and the QCD can count toward satisfying an IRA required minimum distribution (RMD) for the year if it hasn’t already been met.

This strategy can benefit those who do not itemize their deductions because a QCD isn’t included in taxable income.

[RELATED: The ABCs of RMDs]

Give a Bunch

If you give to charity consistently but can’t meet the threshold to itemize your deductions each year, consider combining several years of gifts into one larger gift in one tax year.

You could also use those “bunched” gifts to create a personal charitable fund, called a donor-advised fund (DAF). A DAF allows you to claim an immediate charitable tax deduction, and then you can direct gifts to charities from the DAF on your own timeline.

[RECORDED MOAA WEBINAR: Charitable Giving and Gifting (Premium/Life Member Exclusive)] 

Gift and Get Income

A charitable gift annuity allows you to give cash or securities to a charity and in return receive a partial tax deduction for the donation and a lifelong stream of income from the gift. You can get payments immediately or defer them until later.

A charitable remainder trust is an irrevocable trust that can also generate a potential income stream for you or other beneficiaries, with the remainder going to your favorite charity or charities.

[MOAA MEMBER DISCOUNT: Save on Estate Planning With Everplans]

These are just a few of the charitable gifting options available. Consult with your financial planner and tax advisor on which strategy is best for you.