Charitable Contributions and Your Taxes

Making charitable donations is a powerful way to support causes you believe in—but it can also provide meaningful tax savings when done strategically. At Walker Tax Relief, we help individuals and small business owners turn their generosity into smart tax planning.

Here’s what you need to know to make the most of your charitable giving in 2025.

1. Give to Qualified Charitable Organizations
Only donations made to IRS-recognized 501(c)(3) organizations are eligible for a tax deduction. Before giving, verify the charity’s status using the IRS Tax Exempt Organization Search tool.

Be sure to get a receipt or acknowledgment letter for every donation. It should include:

The charity’s name

Donation amount

Date of the contribution

Statement that no goods or services were provided in return (if applicable)

2. Keep Detailed Records
To claim a charitable deduction, you must maintain accurate documentation:

Cash donations: Keep receipts, bank records, or written letters from the nonprofit.

Non-cash donations: Keep a written description, estimated fair market value, and any appraisal (if required).

For donations over $250, written acknowledgment from the organization is mandatory.

Walker Tax Relief can help ensure your records meet IRS standards.

3. Know the Deduction Limits
The IRS limits how much you can deduct for charitable giving, based on your adjusted gross income (AGI):

Cash donations: Typically deductible up to 60% of AGI

Non-cash donations: Usually limited to 30% of AGI
These limits can vary, so consulting with a tax professional like Jennifer Walker can help you maximize your allowable deduction.

4. Consider Bundling Donations
One tax-smart strategy is bundling donations—making larger contributions in one tax year instead of spreading them out. This helps push your deductions above the standard deduction threshold, making itemizing worthwhile.

This tactic is especially helpful if you alternate between years of standard deduction and itemizing.

5. Donate Appreciated Assets
Want to avoid capital gains tax? Consider donating stocks, mutual funds, or real estate that have appreciated in value. You can deduct the full fair market value and skip the capital gains tax entirely.

Walker Tax Relief frequently works with clients who want to give generously while also reducing their tax liability.

Final Thoughts
Charitable giving doesn’t just help others—it can help you too. With careful planning, your donations can reduce your tax bill and maximize your financial impact.

At Walker Tax Relief, Jennifer Walker, an experienced Enrolled Agent based in Northville, Michigan, can guide you through the process and make sure you don’t miss out on valuable deductions.

Serving Northville, MI and clients nationwide
Need help with your charitable giving strategy? Contact Jennifer Walker today.