Among the many tax-related provisions of the One Big Beautiful Bill Act are two lesser-known changes that may affect those who wish to deduct charitable contributions.
Non-itemizers can deduct up to $1,000
Donors who can’t or don’t wish to itemize deductions may take advantage of a provision that allows them to deduct up to $1,000 each year for cash donations to qualified charities (up to $2,000 for married couples filing jointly).
This allowance is effective starting with the 2026 tax year.
Some itemizers may not be able to deduct their full contribution amounts
Starting in 2026, those who itemize deductions won’t be able to deduct the total amount of their charitable contributions.
Instead, they will only be able to deduct amounts in excess of 0.5% of their adjusted gross income (AGI).
This rule will have the biggest impact on high-income earners.
For example, if your AGI in 2026 is $500,000, and you donate $50,000 to charity in 2026, the “excluded” amount would be $2,500 ($500,000 x 0.05). Therefore, your maximum charitable deduction will be $47,500.
This may not seem like much, but remember that this “deduction floor” applies every year. If you give $50,000 to charity every year for three years, and your AGI doesn’t rise, the aggregated total tax-deductible amount will be $142,500.
If this exclusion concerns you, or if you believe your AGI is likely to rise over time, you might want to consider “bunching up” several years’ worth of donations into a single donation. For example, if you donate $150,000 to charity in 2026, your eligible charitable deduction could be $147,250.
If you’re not sure which charities you want to support, or you would like to spread out your gifts over a multi-year period, a donor-advised fund (DAF) makes this process simple. Just make bunched donations of cash or securities to a DAF to take advantage of its many charitable deduction benefits. You can then schedule one-time or recurring gifts from your account to your favorite charities on your own timetable.
If the “bunched” donation is higher than the maximum amount you can deduct based on your AGI, you may be able to carry over excess contributions to future tax years. Before you consider any of these strategies, you may want to speak with a tax professional.
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This article was authored by David Jaeger and Jeffrey Briskin. David is a financial advisor with Canby Financial Advisors, LLC, an Investment Adviser registered with the U.S. Securities & Exchange Commission. SEC registration does not constitute an endorsement by the SEC nor a statement about any skill or ability. David can be reached at 508.598.1082 or djaeger@canbyfinancial.com. Jeffrey Briskin is Director of Marketing at Canby Financial Advisors.
©2026 Canby Financial Advisors, LLC.