By: Ashten Jackson

The recently announced One Big Beautiful Bill Act is bringing a wave of tax changes, and charitable giving is no exception. While the details do not take effect until 2026, there are a few provisions worth keeping in mind now.

One notable change is a new deduction for non-itemizers who contribute to a qualified charity. The increased standard deductions set by the Tax Cuts and Jobs Act, and now made permanent through the OBBBA, drastically reduced the number of taxpayers claiming itemized deductions. This new rule is designed to make charitable giving more appealing to those who take the standard deduction. This deduction is worth up to $1,000 for single filers, and up to $2,000 for married couples filing jointly. 

Another big change to charitable giving will be coming in 2026. The tax benefits of itemized charitable deductions will be capped at 35% of adjusted gross income. For example, filers in the 37% tax bracket will no longer get a dollar-for-dollar deduction. This has some higher-income taxpayers considering larger charitable contributions in 2025, while the higher deduction rules are still in place. Perhaps most notably, beginning in 2026, there will be a 0.5% of AGI “floor” for charitable deductions—meaning contributions must exceed that threshold floor before they can be itemized. This could make large charitable contributions less appealing from an itemization standpoint. 

In order to maximize a contribution to charity, individuals over age 70½ might consider making Qualified Charitable Distributions (QCDs) directly from an IRA instead of itemizing cash donations. This allows a tax-free distribution from a tax-deferred IRA to be sent to a qualified charity. In 2025, the maximum annual QCD amount for an individual is $108,000. If an individual is over age 70.5, has a tax-deferred IRA, and typically gives to charity, this strategy may be more beneficial than trying to maximize charitable giving by itemizing due to the 0.5% floor of AGI. 

With these upcoming changes, now is a great time to revisit your charitable giving strategy to make the most of both your generosity and your tax benefits. We would be glad to assist you in your review and planning to ensure you are maximizing your strategy.