Three scenarios for tax season and time-sensitive tips

A message from the CICF Collaborative, including Central Indiana Community Foundation, Hamilton County Community Foundation, IMPACT Central Indiana, the Indianapolis Foundation, and Women’s Fund of Central Indiana

In light of the tax law changes that took effect on January 1, now is the time to understand clients’ philanthropic intentions for 2026. Addressing charitable planning at tax time can help ensure that your clients won’t miss out on important opportunities.  

Here are three likely scenarios and time-sensitive tips for what to do:  

Evaluate QCDs sooner rather than later 

The scenario: Your client, who enjoys giving to favorite charities, is 75 years old. 

The tip: Talk with your client as soon as possible about Qualified Charitable Distributions. IRA owners who are 70 ½ and older are eligible to use their IRAs to distribute up to $111,000 in 2026 (indexed for inflation) directly to a qualified public charity, including some types of funds at the community foundation. QCDs can satisfy all or part of a client’s RMD.  

Why it’s time-sensitive: Planning QCDs early in the year helps avoid administrative delays and ensures proper coordination with RMD requirements. For clients who do not itemize deductions—especially in light of the continued higher standard deduction amounts—QCDs remain one of the most tax-efficient ways to give. 

Look for charitable opportunities in business succession planning 

The scenario: Your client is beginning to explore exit strategies for a family business. 

The tip: Contact us early in the planning process. Gifting closely-held business interests to a DAF at the CICF Collaborative prior to a sale can be a powerful planning strategy. The client may receive a charitable income tax deduction (generally equal to the fair market value of the gifted interest if it is long-term capital gain property, subject to AGI limitations). The gifted portion of the business may avoid capital gains tax when a sale occurs down the road, maximizing proceeds flowing into the donor-advised fund to support the client’s philanthropic goals. 

Why it’s time-sensitive: If a sale is already effectively in motion—or if there is a binding agreement in place—the IRS may challenge the charitable deduction under the assignment of income doctrine. Early coordination among legal, tax, and philanthropic advisors is essential.  

Consider gifts of appreciated assets early in the year 

The scenario: A client who itemizes income tax deductions experienced significant portfolio gains in 2025 and anticipates continued market strength in 2026.  

The tip: Consider recommending that your client make a gift of appreciated stock to a donor-advised fund at the community foundation. Gifts of long-term appreciated assets to a donor-advised fund are generally deductible at fair market value (subject to 30% of AGI limitations for appreciated assets, as well as the new floor and cap that took effect on January 1, 2026). The donor-advised fund can sell the asset without incurring capital gains tax.

Why it’s time-sensitive: Pay particular attention to the rules that apply to clients who itemize their deductions versus those who don’t. Beginning with the 2026 tax year, non-itemizers are eligible to deduct cash gifts (not gifts of stock or other assets) to public charities (excluding donor-advised funds) up to $1000 for single filers and $2000 for joint filers.   

As always, our goal at the CICF Collaborative is to serve as your go-to sounding board on all matters related to charitable giving as you structure clients’ tax, estate, retirement, or business planning strategies. We look forward to working together during tax season and beyond!  

About the CICF Collaborative 

CICF Collaborative is a partnership of philanthropic organizations working together to strengthen communities across the region. Each entity within the CICF Collaborative (including the cornerstone entities, Central Indiana Community Foundation, Hamilton County Community Foundation, IMPACT Central Indiana, the Indianapolis Foundation, and Women’s Fund of Central Indiana) brings deep knowledge, strong relationships, and its own individual, focused mission. The CICF Collaborative unites the entities by providing shared services, allowing the entities to operate more efficiently and effectively. By leveraging what we each do best, we’re able to better serve our communities and create more lasting impact, together. Learn more »