Continuing our Plan for Retirement series, we take a closer look at charitable giving in retirement.
For many people, retirement is the first stretch of life with both the time and the resources to give in a way that reflects what they care about most. The university that opened a first door, the hospital that cared for a parent, the church that shaped a family: these are the organizations retirees often want to support more generously once the working years are behind them. Yet how a gift is made can matter nearly as much as its size.
Americans are giving at historic levels. According to Giving USA 2026, total charitable giving reached a record $617.2 billion in 2025, the first year it has crossed $600 billion. Individuals accounted for $394.2 billion of that total, and charitable bequests climbed nearly 20 percent to roughly $62.2 billion. Much of that generosity, however, is still given in cash, which in retirement is often one of the least tax efficient ways to give.
The Rules Changed in 2026
The One Big Beautiful Bill Act, signed in July 2025, brought new limits on charitable deductions that took effect this year, and the changes fall most heavily on the largest givers. Itemized charitable gifts are now deductible only to the extent they exceed 0.5 percent of adjusted gross income, so a family with $1 million of income forfeits the deduction on its first $5,000 of giving each year. Those in the top 37 percent bracket also see the value of the deduction capped at 35 percent. The law’s expanded deduction for state and local taxes also phases back down toward $10,000 for households with income above roughly $505,000 in 2026, which can make itemizing harder to justify even for generous givers. Together, these changes make how a gift is made nearly as important as how much is given.
Giving Directly From an IRA
For retirees age 70½ and older, one of the most effective tools available is the qualified charitable distribution, or QCD. A QCD sends money directly from a traditional IRA to a qualified charity, and the amount transferred is excluded from taxable income. In 2026, each IRA owner may give up to $111,000 this way, according to Fidelity Investments, and a married couple with separate IRAs may give up to $222,000 combined. Once required minimum distributions begin at age 73, a QCD can also count toward the annual RMD, satisfying a distribution the retiree may not need while keeping it off the tax return.
Because a QCD lowers adjusted gross income itself, it can reduce the portion of Social Security benefits subject to tax and may keep a retiree below the thresholds that trigger higher Medicare premiums. It also sidesteps the new deduction floor and cap, and the Congressional Research Service notes that it offers a tax advantaged way to give for retirees who take the standard deduction. The details matter: QCDs must come from an IRA rather than a 401(k), the funds must go directly from the custodian to the charity, and donor advised funds and most private foundations are not eligible recipients.
Appreciated Assets and Multiyear Giving
Retirees who hold stocks or funds that have grown significantly in a taxable account can often donate those shares directly, avoiding capital gains tax on the appreciation while still deducting the full market value if they itemize. For those whose annual giving falls just short of making itemizing worthwhile, combining several years of gifts into a single year, frequently through a donor advised fund, can clear both the standard deduction and the new 0.5 percent floor, with grants to individual charities made gradually in the years that follow.
Planning a Charitable Legacy
Pretax retirement accounts are among the least efficient assets to leave to children or grandchildren, because heirs generally owe income tax on what they withdraw, and most beneficiaries other than a spouse must empty an inherited IRA within ten years. A qualified charity pays no income tax on those same dollars. For families who intend to leave a charitable legacy, naming a charity as beneficiary of an IRA while leaving other assets, such as a brokerage account or a home, to heirs can allow each dollar to do more for everyone involved.
How We Can Help
Charitable giving in retirement tends to work best when it is coordinated with income planning, tax strategy, and estate planning rather than decided gift by gift. We help clients decide which accounts to give from, when to give, and how to structure gifts so that more of each dollar reaches the causes they care about. That work includes timing QCDs alongside required minimum distributions, identifying appreciated holdings well suited for gifting, and collaborating with clients’ CPAs and estate attorneys so the charitable plan and the legacy plan tell the same story.
Generosity is one of the most meaningful ways retirees put their wealth to work, and it deserves the same care as any other part of a retirement plan. Helping families give with intention, and see the impact of that giving during their own lifetimes, is part of how Gryphon pursues its purpose of helping make people’s lives better. If you are thinking about how charitable giving fits into your retirement, we would welcome a conversation.
Disclosure
This material is provided by Gryphon Financial Partners, LLC (“Gryphon”) for informational purposes only. It is not intended as a substitute for personalized investment advice or as a recommendation or solicitation of any particular security, strategy, or investment product. Facts presented have been obtained from sources believed to be reliable, though Gryphon cannot guarantee their accuracy or completeness. Gryphon does not provide tax, accounting, or legal advice. Individuals should seek such guidance from qualified professionals based on their specific circumstances.