Not everyone can make large charitable contributions. But there are ways to be charitable without spending your discretionary income while at the same time lowering your tax bill. Even those who can make large donations benefit from the tax advantages of a cashless donation. The following are ideas for cashless contributions to causes you are passionate about.

Tax Rules

The main thing to remember is that charities are not required to pay taxes on donations (cashless or otherwise). This can make your donation more valuable to them than it would be to you. Note, too, that if your itemized deductions are below the Standard Deduction for your tax filing status, gifting a high-value asset can put you over that cap and provide substantial savings on your tax bill.

The IRS sets limits on deductions for non-cash donations. Contributions of appreciated long-term assets such as stocks or real estate are subject to a limit of 30 percent of adjusted gross income, while other types of non-cash property donations have a 50 percent limit. Cash donations, on the other hand, have a higher limit at 60 percent of AGI. Even so, if the value of the contribution is higher than your deduction limit, you may carry over the excess for up to five years, subject to those same AGI limitations.

Non-cash donations are particularly beneficial for donors in a year they receive a windfall or unexpectedly high income.

Securities

If you own highly appreciated stock, you can donate it to a 501(c)(3) charity and claim the fair market value as a tax deduction. You won’t have to pay taxes on the earnings because you gifted them, nor will the charity once the stock is liquidated for its needs. Consider gifting stock to a charity when you rebalance your portfolio to both reduce the potential tax bill on earnings and reposition the overall portfolio to your target allocation.

Equity Compensation

You may have received employer company stock as a bonus or through an Employee Stock Purchase Plan (ESPP). Consider transferring one or more shares to a charity as a donation. Note that with ESPP shares, you need to have held them for more than two years from the grant date and one year from the purchase date to optimize your tax deduction.

Qualified Charitable Distribution

Traditional IRA owners are required to begin taking an annual minimum distribution (RMD) starting at a specific age. As of 2025, the rules are:

• 72 if born before Jan. 1, 1951
• 73 if born between Jan. 1, 1951, and Dec. 31, 1959
• 75 if born on or after Jan. 1, 1960

However, some people may still be working or have a high income for which RMDs place them in a higher tax bracket. What they can do is make a qualified charitable distribution (QCD) up to $100,000,so that all or a portion of their RMD is sent directly to the charity of their choice. While this tactic does not offer a tax deduction, it does satisfy the IRA owner’s RMD requirement, which essentially reduces their income tax burden.

Real Estate

If you purchased or inherited a piece of property, be it a residential home, undeveloped land, a commercial building or rental property, there are benefits to granting it as a cashless charitable donation. The strategy is best optimized if you’ve owned the property for more than one year, enabling you to avoid capital gains taxes and claim a fair market value charitable deduction for the tax year of the gift.

Automobile

Perhaps you have a spare car you never drive but continue to maintain and insure. Instead, consider donating it to a charity. First, ensure that the charity of your choice will accept a vehicle donation. In some cases, a charity may not even require that the car be in working condition, as it may sell or auction it to raise cash. While most charities will arrange to have the automobile picked up, you will need to remove the license plates and sign over the car title to the organization. You can determine the fair market value (to claim as a tax deduction) by researching pricing guides like Kelly Blue Book or Edmunds.

Collectibles/Art

Some folks collect or inherit items they don’t want anymore. Instead of selling them on Facebook, consider donating them to a charity. First, establish a value for the item(s); for items worth more than $5,000,you’ll need to get a qualified appraisal to determine your tax deduction. Also, make sure the charity of your choice will accept the collectible.

Life Insurance

For an individual who no longer needs their permanent life insurance policy, transferring policy ownership to a charity may be more advantageous than surrendering it and paying taxes on the policy’s appreciation. Donating the policy eliminates your tax liability and qualifies for a deduction. The deduction is the lesser of the policy’s cash value or the cost basis (i.e., premiums paid to date).

Another option is to simply change the beneficiary on your life policy to the charity you choose. You won’t receive a tax deduction until the policy pays out after your death, at which point your estate can claim it.

Time

Don’t forget that in many cases you can donate your time instead of money. Seek out charities that need volunteers, from specific skills and expertise to help with cleaning, delivering, and organizing events.

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