It’s time to dust off your DAF before tax changes take effect

Year-end giving is always top of mind as we get closer to the holidays. This year, many donor-advised fundholders may be wondering what the changing tax laws mean for charitable giving. This year, there is even more reason to get refocus your charitable giving to help your local hardworking nonprofits continue serving those in need. Here is what you need to know: 

• What the heck is “bunching” and what does it mean for me? If you itemize deductions on your income tax return, things are changing next year when both a floor and a cap on itemized charitable deductions kick in. That provides an opportunity to “front-load” or “bunch” charitable contributions into your DAF before the changes take effect. That means you make a larger contribution this year—maybe a full two or three years of your anticipated charitable giving—because you can maximize your tax deduction under the current rules but continue to recommend grants to charities in 2026 and beyond. 
• Do mounds of paperwork spark joy for you? That’s doubtful, especially at this time of year. Your DAF through the Arizona Community Foundation helps organize and streamline your giving (which means a lot less paperwork). You make tax-deductible contributions of cash or appreciated stock, and then recommend grants to your favorite organizations over time, all from one place. Need help? We’re here for you. 
• Is a portfolio approach right for you? Along with your DAF, you can establish a designated or field-of-interest fund at ACF to expand your charitable giving portfolio. A designated fund supports a specific charity for the long term, while a field-of-interest fund focuses on an area of community need, guided by the community foundation’s deep local knowledge. If you are over age 70½, your IRA’s Qualified Charitable Distributions can go directly to field-of-interest and designated funds—reducing taxable income while supporting the causes you care about.
• Do you want to leave a lasting impact in your community? Did you know you can name DAFs or other ACF-based funds as beneficiaries in your will, trust, or retirement account? Retirement plans such as traditional IRAs, for example, can be tax-efficient assets to give to your fund through your estate because the gift bypasses income and estate tax.

Your DAF has a little more sparkle now, right? And, don’t forget that ACF’s experts throughout the state have insights into what is needed most. We encourage you to consider giving to our Thriving Arizona Fund, which helps ACF meet the needs as they change, quickly and efficiently. Each of our ACF regional offices also has a local fund for this purpose, so reach out to your closest office.

We’re here to help, so don’t let confusing terms or technical tax jargon keep you from making the most of your DAF. Call your ACF Relationship Manager for assistance.