December is a season marked by generosity. Whether you’re giving to loved ones or supporting the causes you care about, year-end gifting can be both meaningful and financially smart. With a little planning, your holiday generosity can also become part of a larger strategy to protect your family, minimize taxes, and support long-term goals.
Below are some essential considerations to help you make the most of your year-end giving personally, financially, and within your estate plan.
1. Understanding the Annual Gift Tax Exclusion Each year, the IRS allows individuals to give a certain amount per recipient without triggering gift tax or dipping into their lifetime exemption.
For 2025, the annual exclusion amount is $18,000 per person (or $36,000 for married couples splitting gifts).
This means you can gift to:
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Children
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Grandchildren
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Parents
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Friends
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Anyone else you choose
…without any tax reporting, as long as you stay within the per-person annual limit.
Why it matters:
Annual gifting is a simple, effective way to reduce the size of your taxable estate especially useful for families looking to leave more to loved ones in the future.
2. Charitable Contributions: Giving With Purpose
December is one of the most popular months for charitable giving, and many families use this opportunity to support community organizations, local nonprofits, and causes close to their hearts.
Ways to give strategically include:
• Direct Donations
A straightforward cash or check donation, often tax-deductible if you itemize.
• Donor-Advised Funds (DAFs)
DAFs allow you to make a charitable contribution now (and receive the deduction this year) while deciding on the specific charities to support later. They are excellent for families who want flexibility while building a long-term giving plan.
• Gifts of Appreciated Assets
Donating stocks, mutual funds, or other appreciated assets may allow you to avoid capital gains tax while maximizing your charitable impact.
• Qualified Charitable Distributions (QCDs)
For individuals age 70½ or older, a QCD from an IRA counts toward your required minimum distribution (RMD) and is excluded from taxable income, a powerful tax-saving strategy.
3. Supporting Loved Ones Through Educational and Medical Gifts
Some gifts are not subject to gift tax at all even if they exceed the annual exclusion amount.
These include:
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Tuition payments made directly to an educational institution
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Medical expenses paid directly to a provider
This can be a meaningful way to help children or grandchildren without affecting your annual gifting limits.
4. Holiday Giving That Aligns With Your Estate Plan
Year-end gifting can be even more impactful when integrated with your long-term estate strategy.
Consider:
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Are the people you’re gifting to also beneficiaries of your will or trust?
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Would it be more beneficial to gift now rather than later?
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Are your charitable gifts consistent with the legacy you’d like to leave?
Intentional giving today can complement and strengthen the overall goals outlined in your estate plan.
5. Organizing Your Records Before January
With multiple family events, charitable opportunities, and holiday commitments, December can get busy quickly. Take a moment to:
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Keep receipts or confirmation letters for donations
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Track gifts given to children or grandchildren
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Review beneficiary designations
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Note any conversations with your attorney or financial advisors
A little organization this month makes tax season and the new year much easier.
A Season of Generosity, A Legacy of Impact
Year-end giving is more than a seasonal tradition, it’s a meaningful way to support others while strengthening your family’s long-term plans. Whether you’re donating to a favorite charity, helping a loved one, or reviewing your asset strategy, thoughtful gifting can create benefits that last well beyond December.
If you’d like help ensuring your gifting aligns with your estate planning goals, the Davis Schilken, PC, team is here to guide you every step of the way.
Wishing you a warm, joyful, and generous holiday season.