The charitable giving landscape is set for its most significant tax overhaul in a decade. Starting in 2026, new federal tax rules — enacted via the big GOP/Trump tax and spending bill — will change how nearly every American taxpayer can deduct contributions on federal returns.
For instance, a new tax break allows those who claim the 2026 standard deduction to deduct charitable giving donations. At the same time, new rules limit how the itemized charitable deduction reduces taxes for high earners.
Here are three big ways the charitable deduction is changing for individual taxpayers in 2026, and what these new rules might mean for you.
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Note: This article pertains to federal income taxes only. State income returns may differ.
1. New $1,000 standard deduction charity break in 2026
Do you typically claim the standard deduction on your federal taxes? You’re in luck. Beginning in 2026, there’s a new deduction you could take.
The non-itemizer charitable deduction is available for all taxpayers claiming the standard deduction, worth up to $1,000 ($2,000 for joint filers).
Here are a few fast facts on this key tax break:
- Only cash contributions qualify (checks, credit card charges, online donations and payroll deductions).
- The donation must be made to a qualified 501(c)(3) public charity.
- You must follow the typical IRS rules for a charitable deduction, including obtaining a written acknowledgement if you donate $250 or more.
Unlike the itemized charitable deduction, any contributions exceeding the annual limit for the non-itemized deduction cannot be carried forward. You also can’t use the deduction in conjunction with a donor-advised fund (DAF) or private foundation, as you can for itemized charitable contributions.
Despite these limitations, some predict that 144 million Americans will be eligible to claim the standard deduction charitable tax break.
A similar (though temporary) policy took place during the COVID-19 pandemic, which allowed a $300 charity deduction for individual non-itemizers. Almost 30% of standard deduction filers took advantage of the tax break, “indicating that the One Big Beautiful Bill (OBBB) even larger deduction could be popular,” per the Tax Foundation.
2. 2026 charitable deduction: The 0.5% AGI floor
One of the most significant changes in the 2025 Trump tax bill is the introduction of a “floor” for itemized deductions. Starting in 2026, you can only deduct charitable gifts that exceed 0.5% of your adjusted gross income (AGI).
This significant change effectively eliminates the tax benefit of smaller, routine donations.
For example, if you have a $200,000 AGI and donated $2,000 over the year:
- Your AGI floor is $1,000.
- Only $1,000 of your donation would be deductible.
The change might push more high-income donors toward “bunching” their contributions — making one large gift every few years — to clear the AGI floor and maximize their deductions.
Alternatively, taxpayers age 70½ or older might choose to make more qualified charitable distributions (QCDs), which the 0.5% AGI floor rule does not affect.
For more information on charitable contribution strategies, check out Kiplinger’s report: How High Earners Can Maximize Their Charitable Contribution Donations.
The charitable deduction in 2026 will feature key changes from the so-called “One Big Beautiful Bill”
(Image credit: Getty Images)
3. The new 35% deduction cap for high-income donors in 2026
Charitable contributions for high-income itemizers will be subject to a deduction cap in 2026. The new law imposes a 35% limit on the value of all itemized deductions for those in the highest income bracket.
This means top-bracket taxpayers (currently 37%) will receive a lower effective tax break compared with 2025.
For example, if you have a $2,000 deductible donation as a top federal-bracket earner:
- You could only get $700 in tax savings for 2026.
- In the prior tax year, that same donation resulted in $740 of savings.
Combined, the AGI floor and the charitable deduction cap are expected to lower the tax benefit for donating to charities for high-income earners in 2026.
2026 charitable deduction example: Calculating your new tax benefit
The table outlines how a top tax-bracket donor with an AGI of $1,000,000 with $400,000 in donations could receive a lower tax benefit in 2026 vs the 2025 rules.
|
Feature |
2025 Rules |
2026 Rules |
|---|---|---|
|
Deductible amount (before AGI limits) |
$400,000 |
$400,000 |
|
Deductible amount after the 0.5% AGI floor |
$400,000 (none) |
$395,000 ($400,000 – $5,000) |
|
Deduction cap for top-bracket taxpayer |
$148,000 (37% x $400,000) |
$138,250 (35% x $395,000) |
|
Total potential tax benefit amount |
$148,000 |
$138,250 |
Note: The “total potential tax benefit amount” does not reflect further AGI limits applied or other tax liability limitations applicable to high-income earners.
Important context for carryforwards: While excess contributions can still be carried forward for up to five years, any carryforwards used in 2026 and beyond will be subject to the new limitations. A generous 2025 gift carried into 2026 could unexpectedly result in a smaller tax benefit than originally planned.
Summary of the OBBB changes to 2026 charitable tax rules
|
Tax Rule |
2025 Rules |
2026 Rules |
|---|---|---|
|
Non-itemizer charitable deduction |
None; standard deduction filers could not claim a federal tax deduction for donations. |
Up to $1,000 in cash donations may be claimed as a tax deduction ($2,000 for joint filers). |
|
AGI floor for itemized charitable deduction |
No floor; every dollar is deductible (up to limits). |
Only the portion of total charitable contributions above 0.5% of your AGI is deductible. |
|
Charitable deduction cap |
For those in the 37% tax bracket, the deduction provides a 37% tax benefit. |
The tax benefit of the deduction is capped at 35% for top earners. |
The changes might not affect everyone, depending on your gifting strategy. Consult with a qualified tax professional to discuss which tax strategies are best for your financial circumstances.
