As the holidays approach and we all start to reflect on the year behind us, it’s a good time to talk about gratitude. For many, giving is one of the most meaningful financial actions they take all year. It’s a tangible way to express gratitude, strengthen community ties, and remind ourselves that money has purpose beyond spreadsheets and returns. Yet, somewhere along the way, charitable giving has become something many people associate mainly with tax deductions. At Bowline, we think it’s time to flip that mindset: give first because you believe in the cause, then appreciate the tax benefits that follow.

The Emotional ROI of Giving

When you give intentionally to people, causes, or communities that align with your values, you experience what we call the emotional ROI. It’s the lasting satisfaction of knowing your money is doing real work in the world, whether it’s funding a local food pantry, supporting youth sports, or helping your alma mater thrive. It’s also an antidote to the hyper-individualism that can creep into our financial decisions. We believe true wealth is often felt most deeply when it’s shared.

OBBBA Changes: Why 2025 May Be a Smart Year to Give

Looking ahead from a planning perspective, several key provisions of the OBBBA take effect in 2026, reshaping how deductions are handled.
Here’s what’s changing that may make charitable giving more valuable this year:

  • A new 0.5% AGI “floor” on itemized charitable deductions begins in 2026. That means the first half-percent of your income given to charity won’t count as deductible. For higher earners, this slightly reduces the benefit of large gifts starting next year. 
  • A limited charitable deduction for non-itemizers (up to $1,000 single / $2,000 married) starts in 2026. This is helpful for modest givers, but not nearly as impactful as itemizing in 2025.

To summarize…if you regularly make charitable gifts, or plan to in the near future, front-loading them before year-end 2025 could make financial sense IF you itemize your deductions. Doing so could allow you to maximize today’s deduction rules while they’re still in place.

How Charitable Deductions Work for Everyday Taxpayers

Not every gift qualifies for a tax deduction, and not every deduction is equally valuable.
Here’s the quick rundown:

  • You must itemize to claim charitable deductions (unless for the new small deduction that applies starting in 2026).
  • Cash gifts to qualified public charities are generally deductible up to 60% of adjusted gross income (AGI).
  • Appreciated securities donated directly to a charity or donor-advised fund (DAF) avoid capital gains taxes and can be deducted up to 30% of AGI.
  • Qualified Charitable Distributions (QCDs) from IRAs (for those age 70½+) remain an excellent option and are not impacted by the new OBBBA limits.

We try to remind clients that giving is one of the most personal and rewarding expressions of financial wellness. Whether it’s supporting a cause close to your heart or helping fund a grandchild’s education. These choices don’t just improve balance sheets, they strengthen families, neighborhoods, and communities. 

As the year comes to a close, it’s worth pausing to consider how gratitude shows up in your own plan. The most meaningful gifts are the ones made with intention, not calculation…when you give because it feels right, not because it checks a box on a tax return. The numbers can follow; the fulfillment comes first.

If you’re thinking about ways to make your giving more impactful before year-end, we are here to help you plan with both heart and strategy to ensure your generosity leaves a legacy that lasts well beyond the season.