Should new tax rules change how—and when—you donate?

Taxpayers should carefully evaluate the timing and amount of any significant donations. For example, beginning January 1, 2026, after close review, a taxpayer may find it’s more advantageous to combine multiple years of giving into a single donation and then take a break. Similarly, careful planning may guide an individual to making larger gifts less often.

Also note: The new bill somewhat turns on its head the long-practiced tradition of making donations in high-income years. From now on, it may be better to make donations in lower-income years, when the 0.5% AGI floor will have less of an impact.

Make your donations more rewarding and effective

Below are four helpful practices to keep in mind for successful and purposeful giving. Taking these steps before year-end can be especially helpful if you are likely to donate more in 2025 than you had initially anticipated.

1. Set clear objectives and goals

Be clear about your motivations and values:

• Why do you want to give? Are you driven by personal experience? A desire to give back? Will your giving involve family members? Or are you passionate about creating a legacy?
• What causes matter most to you? Do you have a desire to support innovative ideas, honor your faith, promote opportunity within your community?
• How will you define success? Do you want to tackle immediate issues? Help seek long-term solutions? Or do your goals include both immediate and long-term objectives?

To get started: Imagine the most significant achievement of your philanthropy five or 10 years from now. Clearly defining your objectives can help you focus and enhance your charitable efforts.

2. Know when to give

Timing can be important, particularly if you want your donation to complement your tax planning. Taking these steps can help:

• Align charitable contributions with key milestones or life events, such as major transactions, retirement or even your passing—but, as noted above, pay close attention to the new limitations on tax benefits for charitable giving, and consider these may be higher in high-income years.
• Decide on the amount and duration of your giving: Carefully evaluate the amount of funding needed to achieve your philanthropic goals and the time period during which you will provide support. Is it just for the current year or a predetermined number of years? Does your commitment extend to supporting future generations as well?

3. Establish a governance framework

Create an oversight structure that aligns with your charitable vision, and addresses two key questions:

• Will others be involved in your giving?
• And if so, how will decisions be made?

Answering these questions will help you determine who will participate in the philanthropic structure you create; the expectations for their ongoing engagement; and the process(es) that will be used to reach agreement on key giving decisions.

Involving others can enrich and sustain your mission, and help to foster unity and a sense of shared purpose. Take the time to:

• Consider the impact of involving others in your philanthropy, and whether you prefer family-driven initiatives or more autonomy.
• Identify decision makers, and set clear expectations for their participation to avoid conflicts. Develop selection criteria, such as their education, time commitment and area of expertise. Fill knowledge gaps with experts, and assess participants’ interest and availability through open discussions.
• Establish clear decision-making procedures. Depending on your philanthropic goals, adopting a combination of commonly used voting practices (unilateral, majority and unanimous) may be most effective. For instance, you might use majority voting for annual funding decisions but require unanimity for larger grants. A hybrid approach can ensure inclusivity while maintaining control over significant decisions.
• Have clear funding guidelines to aid decision making. Define the issues and organizations you wish to support, the amounts you will donate and the duration of your giving. Specify any areas or organizations you won’t support to prevent future conflicts.

4. Implement your plans

To launch your giving strategy, identify organizations you admire, and communicate your intentions. Online research and networking can help you identify those that align with your interests and that also have strong track records, commitments to transparency and clear missions.

Once you have this information, you can consider speaking directly with the entities that most interest you to discuss how your donations might be used and their anticipated impact. Also consider the organization’s size, reach and specific programs, as well as how they measure success and outcomes. The more you know about an organization, the better you will be able to determine if its goals are in alignment with your own.

Similarly, be clear about any preferences you have regarding:

• Use of your donation: Do you want your contribution to support specific projects, fund general operations or enhance capacity building?
• Expectations for communications and reporting: Do you want to receive updates and progress reports? Attend board or committee meetings?
• Be open about your desire for transparency and accountability: Will the organization communicate insights into its successes and challenges?

Consider formalizing your intentions through written agreements or grant letters, especially for significant or ongoing contributions. Clearly outline the terms of your support, including any conditions or expectations, to help ensure mutual understanding. Building strong partnerships with organizations can enhance the impact of your giving strategy.

We can help

Given the recent legislative changes, now may be a good time to revise—or accelerate—your charitable giving plans to try to optimize the impact of your charitable efforts, and to also maximize tax benefits this year. Your J.P. Morgan team, in close consultation with specialists in our Philanthropy Centre and your tax advisors, is ready to help you move forward.