Year-End Gifts
Charitable Gifts
Consider gifting low-basis, highly appreciated securities to receive a deduction for the donation's Fair Market Value (FMV) while avoiding the capital gains tax. If appropriate, the stock can be repurchased to maintain exposure while resetting a new, higher-cost basis. Recommended Deadline: December 12
Donor Advised Funds (DAFs)
Consider opening a Donor Advised Fund (DAF) to facilitate gifts of highly appreciated stock. Individuals can receive a tax deduction equal to the Fair Market Value (FMV) for the year of contribution to a DAF while retaining the flexibility to make grants to designated charities over multiple years or even decades.With the new itemized deduction hurdles passed under OBBBA legislation this year, the tax deductibility of charitable donations will be limited for many taxpayers beginning in 2026. As a result, 2025 presents an excellent opportunity to make larger charitable gifts and accelerate planned gifts to maximize your deduction. For additional information on recent tax changes, please see our whitepaper from July: One Big Beautiful Bill Act – Key Changes.
Recommended Deadline: November 28 for charities needing approval
Recommended Deadline: December 12 for charities already approved by Charles Schwab & Co.
Qualified Charitable Distributions (QCDs)
If you are at least 70 ½, you can take advantage of an additional method of gifting from your IRA directly to a charity, termed a "Qualified Charitable Distribution" (QCD). QCDs allow you to donate up to $108,000 per year, which can reduce your Adjusted Gross Income (AGI) and offset your Required Minimum Distribution (RMD). A lower AGI could qualify you for more tax credits or deductions and may lower future Medicare premiums, as these are calculated based on AGI from two years prior. Please contact your Woodmont team for assistance in making a QCD. Recommended Deadline: November 28 for checks written from your IRA checkbook
Recommended Deadline: December 12 for checks requested directly from Charles Schwab & Co.
Annual Gifting Exclusion
The annual gifting exclusion for 2025 allows you to gift up to $19,000 per year (up from $18,000 in 2024) to an individual without counting toward your lifetime estate tax exemption. Married couples can jointly give up to $38,000 to one individual ($76,000 to another married couple). This is an excellent way to transfer cash or stock. Gifting to a 529 college savings plan lets you front-load up to five years’ worth of annual contributions, a powerful strategy if you’re managing a potentially taxable estate. These plans are also evolving into broader family savings tools, with new provisions that allow certain unused balances to be converted to a Roth IRA for the beneficiary and broaden the range of eligible expenses. Beginning in 2026, 529 plans will also permit larger annual withdrawals for K–12 and postsecondary credentialing expenses, raising the limit from $10,000 to $20,000.
Recommended Deadline: December 19
Caution: Donations related to the right to purchase athletic tickets are not tax-deductible. Please consult your CPA before making a gift to an athletic institution.
Year-End Distributions
Beneficiaries of an inherited account post-2019
If you inherited a tax-deferred Individual Retirement Account (IRA) after 2019, you may save on your tax burden by spreading out the required distributions rather than taking a lump sum within ten years. Please contact Woodmont if you would like to explore your options for a post-2019 inherited IRA account.Recommended Deadline: November 28
Note: Certain beneficiaries of IRAs inherited after 2019 may be required to take annual RMDs within the 10-year withdrawal window. While the IRS has waived this requirement for 2021-2024, these beneficiaries must begin taking distributions in 2025.
Retirement account owners
If you turn 73 in 2025, you are required to take your RMD by April 1, 2026. However, taking it by December 31, 2025, can help you avoid the need to take two RMDs in 2026.If you're still working and own less than 5% of your company, you may be able to defer your RMD from an employer-sponsored retirement plan (such as a 401(k)) until the year you retire.
Please contact Woodmont if you want to change your IRA distribution’s tax withholding.
Recommended Deadline: November 28
Lastly, please notify Woodmont if you need additional funds to make a 4th quarter estimated tax payment due on January 15, 2026.
We recognize this is a lot of information. We are available to answer your questions and assist in any way possible.
The Woodmont Team
This document contains general information only and is not intended to be relied upon as a forecast, research, investment advice, or a recommendation, offer, or solicitation to buy or sell any securities or to adopt any investment strategy. The information does not take into account any reader’s financial circumstances or risk tolerance. An assessment should be made as to whether the information is appropriate for you with regard to your objectives, financial situation, present and future needs.
The opinions expressed are of the date of publication and may change as subsequent conditions vary. The information and opinions contained in this material are derived from proprietary and non-proprietary sources deemed by Woodmont to be reliable, are not necessarily all inclusive and are not guaranteed as to accuracy. There is no guarantee that any forecasts made will come to fruition. Any investments named within this material may not necessarily be held in any accounts managed by Woodmont. Reliance upon information in this material is at the sole discretion of the reader. Past performance is no guarantee of future results.