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“How can charitable giving reduce my taxes in Colorado?”
Charitable giving is one of the most meaningful ways to align your wealth with your values. But beyond supporting the causes you care about, strategic giving can also offer powerful advantages for tax efficiency, long-term wealth planning, and legacy building. At A&I Wealth Management, we help clients make charitable decisions that feel good and make financial sense.
With recent changes under the One Big Beautiful Bill (OBBB) taking effect in 2026, now is the ideal time to revisit your giving strategy.
Why Charitable Giving Is Good for Your Wealth
1. Align Your Values With Your Financial Strategy
Giving allows you to create meaningful impact: scholarships, nonprofits, foundations, community programs, faith-based initiatives, and more. These gifts shape your legacy and create opportunities for tax savings.
2. Maximize Tax Efficiency Today
Charitable giving can reduce taxable income when structured wisely. For those who itemize deductions:
- Cash contributions may generate a significant deduction, lowering your tax burden.
- Donating appreciated assets (such as stocks or real estate) helps you avoid capital-gains tax while still receiving a deduction for the full fair-market value.
- Vehicles like donor-advised funds (DAFs) let you claim a larger deduction up front while distributing gifts over time.
3. Strengthen Long-Term Wealth and Estate Plans
Charitable giving can:
- Reduce the size of a taxable estate
- Create income streams through charitable remainder trusts
- Transfer wealth with lower tax exposure
- Reinforce your long-term philanthropic mission as part of your financial legacy
How the One Big Beautiful Bill Changes the Charitable Giving Landscape
Beginning in 2026, the OBBB introduces several major changes. Here are the key updates to understand:
1. New Deduction for Non-Itemizers
Starting in 2026, those who take the standard deduction may claim up to:
- $1,000 (single)
- $2,000 (married filing jointly)
…for qualifying cash gifts.
This is new; previously, non-itemizers generally received no charitable deduction.
2. New Floor for Itemizers
Itemizers will only receive a deduction for charitable contributions that exceed 0.5% of their adjusted gross income (AGI).
3. New Cap for Top Earners
Taxpayers in the highest bracket will have their charitable deduction benefit capped at 35 cents on the dollar.
4. 60% Limit Made Permanent
Cash contributions to public charities will remain deductible up to 60% of AGI, a provision that was previously temporary.
For more on changes resulting from the One Big Beautiful Bill, be sure to also watch our recent lunch and learn on Youtube where Rob Burton CPA breaks down what you need to know.
What This Means for A&I Wealth Management Clients
1. It May Make Sense to Accelerate Larger Gifts Into 2025
Because the new floor and cap don’t take effect until 2026, high-income clients may benefit by:
- Making large planned contributions before the deadline
- Pre-funding a donor-advised fund in 2025
- Donating appreciated assets sooner rather than later
2. Reevaluate Whether You Should Itemize vs. Use the Standard Deduction
The new rules may change the break-even point for:
- Bunching donations
- Timing gifts strategically
- Choosing a giving vehicle (DAF, trust, direct gifts, etc.)
3. Optimize Giving Vehicles
Gifts of appreciated securities, business interests, or real estate may become even more valuable when coordinated with tax planning. Charitable remainder or lead trusts can generate income while reducing future estate taxes.
4. Revisit Estate and Legacy Planning
With deduction caps changing, affluent donors may wish to update:
- Philanthropic trusts
- Gifting strategies
- Estate tax mitigation plans
- Long-term legacy documents
5. Run Updated Projections Under Pre-2026 vs. Post-2026 Rules
Small differences—like a 35% cap instead of a full top-bracket deduction—can lead to large lifetime impacts. Modeling is essential.
How A&I Wealth Management Helps You Give Strategically
Our team supports clients through:
• Purpose-Driven Planning
We uncover what matters most to you and align your charitable mission with your financial life.
• Tax-Smart Structure Optimization
We help determine the most efficient way to give—cash, securities, donor-advised strategies, or trust-based giving.
• Ongoing Review and Adjustment
We ensure your giving plan remains optimized as tax laws evolve, markets shift, and your goals change.
Final Thoughts
Charitable giving is more than generosity—it’s a sophisticated financial strategy. With the One Big Beautiful Bill substantially changing the rules in 2026, now is the ideal time to evaluate your plan.
A&I Wealth Management is here to help you:
- Maximize your impact
- Reduce your tax burden
- Strengthen your long-term wealth strategy
If you’d like help analyzing your charitable giving plan under the new rules, we’re here to support you.
MINI FAQ
1. “Best ways to donate to charity and save on taxes in Denver.”
The most tax-efficient giving strategies for Denver residents include donating appreciated securities instead of cash (to avoid capital-gains tax), contributing to a donor-advised fund for flexible long-term giving, and timing larger gifts in years when you itemize deductions. High-income earners may also benefit from charitable trusts that provide both tax advantages and income streams.
2. “Denver financial advisor charitable giving strategies.”
A Denver-based advisor can help you evaluate whether you should itemize or take the standard deduction, determine the most efficient assets to donate, optimize donation timing, and leverage tools like donor-advised funds or charitable remainder trusts. Strategic guidance ensures your giving aligns with both financial goals and Colorado-specific tax considerations.
3. “How does the Big Beautiful Bill affect charitable giving?”
Beginning in 2026, the Big Beautiful Bill introduces a new deduction for non-itemizers, sets a 0.5% AGI floor for itemizers, and caps the tax benefit for top earners at 35 cents per dollar donated. These changes may reduce the overall value of deductions for large donors, making 2025 an important planning year to lock in higher tax benefits for major gifts.
4. “Should I donate appreciated stock instead of cash?”
In many cases, yes. Donating appreciated stock allows you to avoid paying capital-gains tax you would owe if you sold the shares, while still receiving a charitable deduction for the full market value. This approach can significantly lower your tax liability compared to gifting cash.
5. “Charitable giving strategies for estate planning in Colorado.”
Charitable giving can reduce the size of a taxable estate, support long-term philanthropic goals, and create income or transfer benefits through tools like charitable remainder trusts or charitable lead trusts. Coordinating charitable gifts with your broader estate plan can preserve more wealth for beneficiaries while supporting causes you value.
Disclaimer: The information provided in this blog post is for general informational purposes only and should not be construed as financial or legal advice. Please consult with a qualified professional for advice regarding your specific situation.
DISCLOSURE: Client stories included in this blog reflect hypothetical client situations that represent those commonly encountered by AIWM representatives.
