MERIDIAN, IDAHO / ACCESS Newswire / April 24, 2025 / High-income earners and charitably inclined individuals now have a powerful tool for optimizing their tax returns: bunching. In a new post by Wealth Management Advisor Jacob Nye, White Cloud Wealth Management outlines how strategic itemizing and timing of charitable contributions can significantly reduce taxable income.
"Itemizing and Bunching: A Smart Tax Strategy for Charitable Giving" breaks down how this method works, who benefits most, and how additional strategies such as Donor-Advised Funds (DAFs), Donations in Kind, and Qualified Charitable Distributions (QCDs) can further enhance the benefits of bunching.
Understanding the Basics of Itemized vs. Standard Deductions
The article explains how the IRS offers taxpayers the option of either a standard deduction or itemizing specific deductible expenses such as charitable gifts, medical costs, and state and local taxes. While the standard deduction was significantly increased by the Tax Cuts and Jobs Act of 2018, itemizing remains a valuable tool-especially when strategically employed through bunching.
What Is Bunching and Who Should Consider It?
Bunching involves consolidating charitable contributions from multiple years into one tax year to exceed the standard deduction and enable itemizing. This is particularly beneficial for:
High-income earners
Households near the itemization threshold
Donors with flexible giving timelines
Retirees planning ahead for RMDs
Families with fluctuating incomes
By doing so, individuals may unlock thousands of dollars in potential tax savings.
Donation Strategies That Enhance Bunching
The post outlines three main strategies to boost bunching benefits:
Donor-Advised Funds (DAFs): Offer a way to take a large deduction in one year while maintaining flexibility in distributing gifts to charities over time.
Donations in Kind: Provide dual tax advantages-avoiding capital gains and receiving deductions based on the fair market value of appreciated assets.
Qualified Charitable Distributions (QCDs): Enable retirees aged 70½ and older to contribute directly from IRAs to qualified charities, lowering taxable income without needing to itemize.
Smart Giving, Smarter Tax Strategy
Bunching allows individuals to align their financial planning with their charitable goals. Nye emphasizes that the right combination of timing, structure, and strategy can significantly reduce tax liability while ensuring meaningful contributions to worthy causes.
To learn more or schedule a personalized consultation, visit White Cloud Wealth Management.
Media Contact:
White Cloud Wealth Management
Phone: 208-795-5123
Email: info@whitecloudwm.com
Location: Meridian, Idaho
Author: Jacob Nye - Wealth Management Advisor
Disclosure:
This press release reflects the personal opinions and viewpoints of White Cloud Wealth Management employees. It is not intended as investment advice or a recommendation to buy or sell any security. All views are subject to change at any time without notice.
SOURCE: White Cloud Wealth Management
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