When the Mail Fails Your Clients, a Donor-Advised Fund Doesn't

If you were surprised to read about the ripple effect of a seemingly small change in U.S. Postal Service regulations late last year, you were not alone. Here's what happened, what it means for your clients' 2025 deductions, and what to do about it.

Some Background

Under long-standing IRS guidance, a charitable contribution is generally considered "made" for tax purposes when the donor irrevocably parts with control of the gift. For checks sent through the mail, the IRS has traditionally treated the U.S. Postal Service postmark date as the date of the gift, even if the charity receives the check later. This approach is reflected in IRS Publication 526 and mirrors the broader "mailbox rule" under Internal Revenue Code Section 7502, which treats certain documents and payments as timely based on their postmark date rather than the date of receipt. 

So What Changed?

In November 2025, the USPS - not the IRS - changed how postmarks are applied. Effective December 24, 2025, the official postmark date is now the date of the first automated processing scan at a USPS facility, not the date a letter is dropped in a mailbox or handed to a postal clerk. Mail deposited on December 31, 2025, may not have received a postmark until several days into January, especially around the holidays. The USPS issued a "facts and myths" circular in response to the confusion, but the damage was done for many year-end givers.

What Does This Mean for a Client's 2025 Deduction?

Because the IRS still relies on the postmark to establish when a mailed gift was made, a contribution a client intended to deduct in 2025 could be treated as a 2026 contribution if the postmark reflects a January processing date.

Is the Client Out of Luck?

Not necessarily. The underlying IRS rules on charitable contribution timing have not changed. What has changed is the ability to rely entirely on an ordinary envelope postmark as proof. Advisors should help clients gather any alternative documentation that establishes when the gift was actually mailed: a USPS Certificate of Mailing, a certified or registered mail receipt, or a manually applied postmark obtained at a retail counter. Copies of the check, contemporaneous notes, and any correspondence with the charity should also be retained. In short, you may still be able to build a case for a 2025 deduction.

What Should Clients Do Going Forward?

Electronic giving eliminates this risk entirely. Online donations, ACH or wire transfers, and completed transfers of publicly traded securities all carry clear, immediate timestamps that don't depend on postal processing. Advisors should make this part of their standard year-end giving guidance.

How the Community Foundation Can Help

A donor-advised fund at the Community Foundation offers the cleanest solution. Clients contribute to the fund before year-end, lock in their charitable deduction for that tax year, and then recommend grants to their favorite charities on their own timeline, with no postmark involved and no deadline pressure. Reach out to our team early in the year - the best time to set this up is well before the holiday rush, not during it.

Questions about a specific client situation? Call us. A brief conversation can provide the clarity and support you and your clients need in exactly these moments.