If you’re planning a gift to charity this holiday season, you could score a tax break by donating cryptocurrency. But there are some key things to know before making the transfer, experts say.

In 2024, there’s been a significant jump in crypto gifts to charity, according to Fidelity Charitable, which has accepted $688 million in crypto donations — mostly in bitcoin — through Nov. 19. By comparison, the public charity received $49 million in digital currency in all of 2023.

Donating crypto to charity is similar to giving other types of property. But “there are some pitfalls,” said certified financial planner Juan Ros, a partner at Forum Financial Management in Thousand Oaks, California. 

But if you itemize and can claim the charitable deduction, it’s generally better to donate profitable investments, such as cryptocurrency, rather than cash.

By donating crypto to charity, you can bypass capital gains taxes and claim a deduction based on its fair market value, assuming you’ve owned it for more than one year. The tax break has a cap of 30% of your adjusted gross income for public charities.

It’s an attractive strategy for crypto investors because bitcoin and other coins could be “the most highly appreciated asset in their portfolio,” said Kyle Casserino, vice president and charitable planning consultant for Fidelity Charitable.

The price of bitcoin was around $96,000 on Dec. 4, up by nearly 120% year-to-date, according to Coin Metrics.

However, donating crypto can be more complicated than assets like stock, experts say.

As of January, 56% of the biggest U.S. charities accepted cryptocurrency donations, according to The Giving Block, a platform for digital currency gifts and fundraising. That’s up from 49% the previous year.  

However, most large donor-advised funds are “well-equipped” to accept digital currency, Ros said.

Donor-advised funds are investment accounts that work like a charitable checkbook. The donor receives an upfront deduction and can transfer funds to eligible nonprofit organizations later. 

Typically, the donor-advised fund sells the crypto and reinvests the proceeds. But some allow investors to continue holding digital assets in the fund.

That’s easy for publicly traded stock, but the IRS requires added documentation for digital assets worth more than $5,000, according to Andrew Gordon, a tax attorney, certified public accountant and president of Gordon Law Group.

“You’ve got to be able to support that deduction through the qualified appraisal,” which has specific IRS requirements, he said.

For example, you must file Form 8283 with your tax return and keep a copy of the appraisal. But if the donated assets exceed $500,000, you must include the appraisal with your return, according to the IRS.

You need to follow the IRS appraisal criteria “to the letter,” Ros explained. Otherwise, you could put your charitable deduction at risk in the event of an audit.

More federal student loan borrowers have been able to get their debt discharged in bankruptcy over the last few years, thanks to new guidance that the Biden administration has issued.

That more lenient policy may be at risk when President-elect Donald Trump enters the White House in January, experts say.

Here’s what borrowers need to know.

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Higher education expert Mark Kantrowitz also expects to see a reversal in the approach.

“The Trump Administration is likely to rescind this guidance,” Kantrowitz said, referring to the Biden administration’s looser rules for student loan borrowers in bankruptcy.

Latife Neu, a bankruptcy lawyer in Seattle, said she wasn’t sure bankruptcy would necessarily become more difficult for student loan borrowers under Trump.

“There is a surprising amount of consensus across the political spectrum,” Neu said, that the higher bar for student loan borrowers to get their debt discharged in bankruptcy is “a defective policy.”

The Trump transition team did not immediately respond to a CNBC’s request for comment .

In the fall of 2022, the U.S. Department of Education and the U.S. Department of Justice released updated bankruptcy guidelines to make it easier for struggling borrowers to get their student loans erased in court.

Previously, it was difficult, if not impossible, for people to part with their education debt in a normal bankruptcy proceeding.

In the 1970s, lawmakers added a stipulation that student loan borrowers needed to wait at least five years after they began repayment to file for bankruptcy. Policymakers and pundits had raised concerns that students would rack up a bunch of debt and then try to get rid of it after graduation.

The waiting period was upped to seven years in 1990. The rules changed yet again almost a decade later, so that only people who proved that their student debt posed an “undue hardship” could discharge it.

Congress, however, never spelled out what that term means, and lawyers and advocates say the uncertainty led to unfairness in the courts.

The Biden administration’s recent approach treats student loans more like other types of debt in bankruptcy court, experts say. Borrowers are able to fill out a 15-page form, detailing their financial struggles and making their case for a mulligan.

In the first 10 months of the new policy, student loan borrowers filed more than 630 bankruptcy cases, a “significant increase” from recent years, the Biden administration said in a statement at the time.

“The vast majority of borrowers seeking discharge have received full or partial discharges,” it said.

There’s soaring interest in donating cryptocurrency to charity as digital currency investors seek to maximize their tax break and impact.

“A lot of folks have begun to realize that crypto giving is hugely beneficial,” said Kyle Casserino, vice president and charitable planning consultant for Fidelity Charitable, a public charity that accepts bitcoin, ethereum and litecoin.

Bitcoin donations have surged amid the latest rally as investors learn about the tax benefits, according to Casserino.   

For 2024, Fidelity Charitable has accepted $688 million in crypto donations through Nov. 19. That’s up from $49 million in all of 2023 and $38 million in 2022, according to the organization’s 2024 giving report.

For some perspective, as of Dec. 31, 2023, Fidelity Charitable had received more than $565 million in cumulative gifts since the charity started accepting the assets in 2015.

“Most of our volume, in terms of numbers and dollars, is all in bitcoin,” Casserino said.

DAFgiving360, formerly Schwab Charitable, doesn’t release numbers for crypto donations. But the organization reported that it received 63% of contributions in non-cash assets, such as crypto and stocks, for fiscal year 2024.

Some 56% of the top 100 U.S. charities accepted crypto donations as of Jan. 2024, according to The Giving Block, a platform for digital currency gifts and fundraising.

Most taxpayers use the standard deduction on their returns, which doesn’t allow itemized tax breaks, such as charitable gifts.

But if you itemize and can claim the charitable deduction, it’s generally better to donate profitable assets, like cryptocurrency or stocks, rather than cash, according to Andrew Gordon, a tax attorney, certified public accountant and president of Gordon Law Group.

By gifting appreciated investments, you can avoid triggering capital gains taxes, which saves the donor and charity money. Generally, you can deduct the asset’s fair market value if you’ve owned it for more than one year. The cap on the tax break is 30% of your adjusted gross income for public charities.

“It’s a good strategy, especially with crypto and bitcoin at all-time highs,” Gordon said. “It’s something that we’re going to be suggesting more to people.”

The price of bitcoin was hovering around $95,000 early on Dec. 4, up by nearly 120% year-to-date, according to Coin Metrics. Bitcoin investors saw a post-election rally fueled by President-elect Donald Trump, who promised pro-crypto policy during his campaign.