What Is Charitable Bunching? Tax-Smart Giving Strategies for Investors

Charitable bunching is a tax-smart giving strategy that involves grouping multiple years of charitable donations into a single tax year. This allows you to exceed the standard deduction and itemize, potentially maximizing your tax benefits while supporting the causes you care about.

What Is Charitable Bunching?

Charitable bunching is a philanthropic tax planning strategy that enables donors to maximize deductions by consolidating multiple years of charitable contributions into a single tax year. Instead of giving the same amount every year, you “bunch” two or more years’ worth of donations into a single year to exceed the standard deduction, making itemizing worthwhile.

Since the Tax Cuts and Jobs Act of 2017 raised the standard deduction and capped state and local tax (SALT) deductions, fewer taxpayers have been able to itemize their deductions. Charitable bunching helps restore the tax benefits of giving, particularly for households that consistently give but fall just short of the itemization threshold.

(Note: Standard deduction amounts are adjusted annually for inflation. As of 2025, the deduction is $14,600 for single filers and $29,200 for married couples filing jointly. Always confirm current limits with your tax professional.)

How Does Charitable Bunching Work?

Here’s a simple breakdown of how bunching plays out in practice:

1. Estimate your deductions. Add up mortgage interest, SALT (limited to $10,000), charitable gifts, and other itemizable deductions.

2. Compare to the standard deduction. If your total deductions fall short, you likely won’t benefit from itemizing in that year.

3. Bunch your giving. Instead of spreading $10,000 of donations evenly over two years, contribute the full $20,000 in one year.

4. Itemize in the bunching year. Your combined deductions exceed the standard deduction, unlocking tax savings.

5. Take the standard deduction the following year. In off-years, resume regular giving or pause until your next bunching cycle.

Who Benefits Most From Charitable Bunching?

This strategy can be especially effective for:

• Married couples whose combined deductions hover just below the itemization threshold.

• Taxpayers with capped SALT deductions, reducing the value of itemizing without charitable contributions.

• Families with consistent giving goals who want to continue their charitable support but maximize efficiency.

• Retirees or high-income earners have the flexibility to time their donations.

Tools to Enhance Charitable Bunching

To streamline this strategy, many donors use additional planning vehicles:

• Donor-Advised Funds (DAFs): Contribute several years’ worth of donations in one year, take the immediate tax deduction, and then distribute grants to charities over time.

• Appreciated Assets: Donate stock or other investments directly, avoiding capital gains tax while maximizing your deduction.

• Trusts & Foundations: For larger or legacy-driven philanthropy, consider establishing a charitable trust or private foundation.

When Charitable Bunching May Not Make Sense

While charitable bunching offers advantages, it isn’t always the right strategy:

• If your deductions already exceed the standard deduction, bunching may not provide additional tax benefit.

• If you prefer steady, predictable giving, bunching may not align with your philanthropic goals.

• If liquidity is an issue, funding multiple years of giving at once may be challenging.

Frequently Asked Questions About Charitable Bunching

1. What is the standard deduction in 2025?

For 2025, the standard deduction is $14,600 for individuals and $29,200 for married couples filing jointly (subject to IRS updates).

2. Can I bunch non-cash donations like stock?

Yes. In fact, donating appreciated securities can provide additional tax advantages.

3. How often should I bunch my donations?

Most donors choose to give every two to three years, but the cadence depends on your financial goals and philanthropic intentions.

4. Will tax law changes impact charitable bunching?

Yes. Deduction limits, thresholds, and contribution rules are subject to change. A financial advisor can help you monitor legislation and adjust accordingly.

How Mission Wealth Can Help

At Mission Wealth, we help clients integrate philanthropy with their overall financial and estate strategies. Whether you’re considering charitable bunching, donor-advised funds, or legacy giving, our advisors can model the tax impact and design a giving plan that reflects your values and maximizes benefits.

Schedule a complimentary strategy session to explore whether charitable bunching is right for you.