As your agency grows, you’ll hit years where your income — and your tax bill — spikes. That’s when smart planning matters most. One of my favorite tools isn’t new, but it’s something most people don’t talk about outside of wealthy families and their advisors: the Donor-Advised Fund (DAF).

I use one myself, and I’ll show you why it’s such a powerful way to give back and cut taxes.

What’s a Donor-Advised Fund?

A Donor-Advised Fund is like a charitable investment account. Here’s how it works:

1. You contribute cash, stock, or other assets.
   
2. You get the tax deduction right away for the full value of your contribution (subject to IRS limits).
   
3. You give on your own schedule — recommending grants to your church or favorite causes over time.
   
4. The money grows while you wait — funds inside the DAF can be invested in something like the S&P 500.
   

That’s why wealthy families love DAFs: immediate tax savings, long-term giving flexibility, and investment growth in between.

The New “Charitable Floor” Rule

The new tax law changes the game starting in 2026:

• The first 0.5% of your income you give to charity will no longer be deductible.
  

Here’s what that looks like:

• If you take home $500,000 in 2026, the first $2,500 you donate doesn’t count toward a deduction.
  
• Over 10 years, giving $2,500/year adds up to $25,000 — and you wouldn’t get a single dollar in tax benefit.
  

That’s a big shift.

My Strategy: Front-Load Giving in 2025

Here’s how I personally use a Donor-Advised Fund to stay ahead of the rule change:

• In 2025, I will contribute $50,000 into my Donor-Advised Fund.
  
• Because there’s no floor in 2025, I get the full $50,000 deduction right away.
  
• Over the next several years, I’ll direct grants from the DAF to my church and to causes my family supports.
  
• Meanwhile, that $50,000 is invested inside the fund, compounding tax-free until it’s granted out.
  

The result? I lock in the deduction now, give consistently later, and let the money grow in the meantime.

Using Appreciated Assets: The Power Move

Cash is good, but moving appreciated assets into a DAF is even better.

For example, let’s say you bought stocks for $50,000 ten years ago, and today they’re worth $150,000.

• If you sold them today, you’d owe nearly 30% in taxes on the $100,000 of gains — about $30,000 lost to the IRS.
  
• But if you transfer the shares directly into your Donor-Advised Fund:
  
  • You pay no capital gains tax.
    
  • You get a full $150,000 deduction this year.
    
  • The entire $150,000 goes to charity over time instead of $120,000 after tax.
    

This is the kind of move that the ultra-wealthy use every year — and there’s no reason agency owners can’t use the same strategy.

Why Agency Owners Should Pay Attention

If your agency is profitable, you’re probably already writing checks to charity each year. A Donor-Advised Fund helps you:

• Maximize deductions in high-income years instead of losing them to the new floor.
  
• Turn appreciated investments into bigger gifts while skipping the capital gains tax.
  
• Simplify giving with one receipt instead of tracking dozens.
  
• Involve your family in making charitable decisions.
  

Final Word

A Donor-Advised Fund is one of the smartest ways I’ve found to combine generosity with tax planning. With the new law kicking in for 2026, there’s a unique window in 2025 to set yourself up.

At Agency CPAs, we help digital agency owners like you build strategies that protect profits, reduce taxes, and still let you support the causes that matter most.

If you’ve ever thought about giving back more strategically, now’s the time to start the conversation.