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The 400 richest people in America are now worth a combined $8 trillion, and it took a record $4.4 billion just to make the list. Elon Musk sits on top at roughly $908 billion. (1)
Here’s the part that got my attention. Nearly 80% of them have given away less than 5% of their wealth, and 44% have given away less than 1%, according to Forbes. (1)
I’m not here to pile on. It’s their money, and many plan to give much of it away eventually. But you don’t need a billion dollars to give well.
I’ve been a CPA since 1981, and I’ve watched a lot of generous people overpay the IRS on gifts they were going to make anyway. They write a check, drop it in the mail and never think about the tax side.
That’s a mistake, especially this year. Retirees can send up to $111,000 straight from an IRA to charity in 2026. (2) The standard deduction just rose to $32,200 for married couples filing jointly. (3) And a new rule finally lets people who don’t itemize deduct some cash gifts. (4)
Put those together, and an ordinary retiree can out-give a billionaire, percentage-wise, and pay less tax doing it. Here’s how.
1. Give from your IRA, not your checkbook
If you’re 70½ or older, this is your best giving tool: a qualified charitable distribution, or QCD.
The money goes directly from your traditional IRA to the charity. You get no deduction, but you don’t need one: the withdrawal never shows up as taxable income in the first place. (2)
It gets better at 73, when required minimum distributions kick in (75 if you were born in 1960 or later). A QCD counts toward that required withdrawal. (2) So money you’d be forced to take and pay tax on goes to a cause you care about instead.
Two rules to remember: the IRA custodian must send the money straight to the charity, and a donor-advised fund doesn’t qualify. (2)
2. Give stock, not cash
If you’ve owned a stock or fund for more than a year and it’s gone up, don’t sell it and donate the proceeds. Donate the shares.
When you itemize, you can generally deduct the full market value of long-held appreciated stock, and you never pay capital gains tax on the growth. (5) The charity sells it tax-free.
Say you paid $2,000 for shares now worth $10,000. Sell them first, and you owe tax on an $8,000 gain. Give them away, and that gain simply disappears from your tax picture.
There’s a cap: deductions for this kind of gift are generally limited to 30% of your adjusted gross income, with the excess carried forward. (5) Few retirees will ever bump into it.
3. Bunch your gifts to beat the standard deduction
Here’s a problem most givers miss. Your gifts only reduce your taxes if your itemized deductions top the standard deduction.
For 2026, that’s $16,100 for singles and $32,200 for married couples filing jointly. (3) Add $2,050 if you’re single and 65 or older, or $1,650 for each spouse 65 or older. (6) A retired couple could easily have a $35,500 hurdle.
Many retirees with paid-off homes never clear it. Their gifts, however generous, save them nothing.
The fix is bunching. Instead of giving $10,000 a year, give $30,000 every third year. That year, you itemize. The other two, you take the standard deduction.
A donor-advised fund makes this painless. You put in several years’ worth at once, take the deduction that year, then hand out grants to charities on your usual schedule.
One wrinkle: starting this year, itemizers can only deduct charitable gifts above 0.5% of their adjusted gross income. (4) On $100,000 of income, the first $500 doesn’t count. Bunching helps you clear that floor, too.
Bunching, stock gifts and QCDs all interact with your income, Medicare premiums and taxes. If you’ve got real money involved, it pays to have a pro run the numbers.
It’s easier than ever to find a fiduciary financial advisor. For example, SmartAsset matches you, free, with up to three fiduciary advisors, who are legally required to put your interests first. They can spot tax savings and planning gaps you’d never see alone. Have $100K+ in investments? Get matched free in minutes.
Quick gut-check — if your money advice is coming from random online influencers, you’re playing a dangerous game. I’ve been a CPA since 1981 and writing about money since before the internet existed. Sign up for the free Money Talks Newsletter and get expert advice that’s been tested by time.
4. Take the new deduction if you don’t itemize
For years, most Americans got zero tax benefit for giving because they took the standard deduction. That changed this year.
Starting with 2026 returns, people who don’t itemize can deduct up to $1,000 in charitable gifts, or $2,000 on a joint return. (4)
There are strings. Only cash counts: checks, card charges, online gifts and payroll deductions. And gifts to donor-advised funds don’t qualify. (4)
It’s not a fortune, but it’s free money for something you’d do anyway. Keep receipts.
5. Check out the charity before you give
A gift to a fake charity isn’t generous. It’s just lost.
The IRS warns that scammers set up bogus charities, especially after disasters, to collect money and steal personal information. (7) If the organization isn’t qualified, your gift isn’t deductible, either.
Before you give, look up the group on the IRS Tax Exempt Organization Search tool. (8) Independent raters like Charity Navigator can show you how a charity spends its money. And never give to someone who calls you and pressures you to pay on the spot.
For more help spotting scams, AARP is worth a look.
Nearly any adult can join, and members get the AARP Fraud Watch Network, plus savings on everyday purchases like eyeglasses, prescriptions and travel. At as low as $15 for your first year with auto-renewal, one use of a benefit can cover the cost.
6. Put charity in your estate plan
Some of the smartest giving happens after you’re gone.
If you plan to leave money to both family and charity, leave the charity your traditional IRA. Heirs owe income tax on what they withdraw from an inherited traditional IRA. A qualified charity owes none. (9)
Then leave your heirs other assets, like a taxable brokerage account or your home. Those typically get a stepped-up cost basis at your death, which can wipe out tax on the gains. (9)
You don’t have to go all-or-nothing. You can name a charity for part of an IRA and your kids for the rest. (9)
Beneficiary forms handle the IRA, but the rest of your wishes need a will or trust.
A will spells out exactly who gets what — you can get one in minutes for $199. A trust goes further, controlling how and when heirs inherit, starting at just $499. One hour now protects your family and prevents bitter fights.
The bottom line
The Forbes 400 list is a scoreboard for wealth, not generosity. And on that second scoreboard, anybody can compete.
A retiree who sends a few thousand dollars from an IRA, gives appreciated stock instead of cash or bunches gifts into one year can give a bigger share of what they have than most billionaires do. And they can keep more for themselves while doing it.
The IRS has handed you the tools. Use them.
I’ve always said money has three purposes: to meet your needs, to meet some of your wants and, most important, to make someone smile. The smartest giving does all three at once.
Sources: 1. Forbes; 2. Kiplinger; 3. IRS; 4. Kiplinger; 5. IRS; 6. Kiplinger; 7. IRS; 8. IRS; 9. Kiplinger
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