by Kerry Meath-Sinkin, CLWS parent, Board Member, and CFP® AIF®Wealth Advisor
Back in 2015, when we moved back to Minnesota with our three-year-old son and baby girl, we found our way to City of Lakes Waldorf School. Since then, the community has enriched our lives in countless ways—and we are deeply grateful.
As a financial advisor, I help people and families use their money. I want them to reach their personal goals. I also want them to make a positive impact in the areas they care about. For our family, the school community here is one of those places. At the same time, we believe in being thoughtful and strategic about our giving.
With that in mind, I want to share some strategies to help you understand the tax benefits of school donations. You might consider these if you want to help City of Lakes Waldorf School more. These ideas could also make your charitable giving more tax-efficient.
Reap the Tax Benefits of School Donations with these 5 Strategies:
Strategy #1 – Own Appreciated Stock? Consider Donating Shares Instead of Cash
When you sell appreciated stock and then donate the proceeds, you incur tax on the gains—whether short- or long-term. In some cases, that tax can significantly reduce the amount ultimately available for the school.
By donating stock to a qualified charity, you can avoid capital gains tax on its increased value. You can also get a charitable deduction for the full fair-market value. That means more impact for City of Lakes and greater tax efficiency for you.
Strategy #2 – Consider Bunching Your Giving into a Larger One-Time Donation
If you often donate just below the standard deduction, you might not get the full tax benefit from your gifts. “Bunching” lets you combine donations from two or more years into one tax year. You can do this through a donor-advised fund or a large direct gift. This way, you can itemize your deductions for that year and take the standard deduction the next year.
Why this matters now: 2025 may be an especially valuable year to plan your giving. Starting in 2026, the new One Big Beautiful Bill Act (OBBBA) will change charitable deductions. It will set new limits for itemizers and create a new deduction for non-itemizers. Accelerating or “bunching” gifts into 2025 may help maximize your deduction under current rules before these updates take effect.
Strategy #3 – NEW for 2026: The One-Time $1,000 Above-the-Line Charitable Deduction
Starting in 2026, taxpayers who do not itemize can claim a new charitable deduction. This applies to tax years that start on January 1, 2026. This deduction is above-the-line. It allows individuals to deduct up to $1,000. For married couples filing jointly, the deduction is up to $2,000.
This is a good change. It lets people who take the standard deduction still get a small tax benefit for giving to charity. The deduction will not apply to donations made to donor-advised funds or private foundations.
In addition, OBBBA made several changes that affect those who continue to itemize beginning in 2026:
- Charitable gifts will only be deductible to the extent they exceed 0.5% of Adjusted Gross Income (AGI).
- The tax authorities will cap the maximum benefit of itemized deductions at 35%, even for those in the top income bracket.
- Cash donations to public charities can still be deducted up to 60% of your AGI. This rule started with the Tax Cuts and Jobs Act.
Together, these changes make 2025 a key year for charitable planning. If you want a bigger donation or plan to create a donor-advised fund, it’s smart to act before 2026. The new limits will begin then.
Strategy #4 – If You’re Age 70 ½+ and Have an IRA: Utilize a QCD
If you or a loved one is age 70½ or older and has a traditional IRA, you can make a Qualified Charitable Distribution (QCD) directly from your IRA to City of Lakes Waldorf School.
The transfer goes directly to the charity. This means it does not count as taxable income. This is different from a withdrawal followed by a donation.
Even though Required Minimum Distributions (RMDs) start at age 73, Qualified Charitable Distributions (QCDs) can begin at 70½. QCDs are one of the best ways to give from retirement assets while saving on taxes.
Strategy #5 – Include City of Lakes in Your Legacy & Estate Planning
You can make a lasting difference by naming City of Lakes Waldorf School as a beneficiary. You can do this with your retirement accounts like IRA, 401(k), or 403(b). You can also name them in your life insurance policies, donor-advised funds, or taxable investments.
Charitable organizations do not pay income tax. This means your entire gift goes directly to the school’s mission. It can also help reduce estate taxes for families whose assets exceed Minnesota or federal exemption limits.
A Final Thought
The strategies above are for general education only, I’m hoping you have a better understanding of the tax benefits of school donations. Please talk to your accountant or financial advisor about your situation. If you don’t have an advisor, you can learn more about these ideas. Please contact me at [kmsinkin@meathwealthadvisors.com]
Thank you from the bottom of our hearts for all that you do—and continue to do—to help City of Lakes thrive.
Warmly,
Kerry Meath-Sinkin CFP® AIF® Wealth Advisor
Journey Strategic Wealth LLC (“Journey”) is a Registered Investment Advisor. Kerry Meath-Sinkin is also a registered representative of Purshe Kaplan Sterling Investments, Inc. (“PKS”). In their separate capacity as a Registered Representative of PKS, Kerry Meath-Sinkin may recommend the implementation of securities through PKS instead of Journey.Securities offered through Purshe Kaplan Sterling Investments, member FINRA/SIPC. Headquartered at 80 State Street, Albany, NY 12207. Purshe Kaplan Sterling Investments and Journey Strategic Wealth d/b/a Meath Wealth Advisors are not affiliated companies. Information in this message is for the intended recipient[s] only. If you have received an email from Journey in error, we ask that you contact the sender and destroy the email and its contents. Please visit our Website for important disclosures.
This post is sponsored by Meath Wealth Advisors.
If you’d like to donate to CLWS, you can do so here. We are so appreciative of the generosity and ongoing support of our CLWS community.
