How the OBBBA Reshapes Charitable Giving for 2025 and 2026
- Stephen Griffin
- 3 days ago
- 2 min read
The One Big Beautiful Bill Act brings tax changes that will directly impact how Americans plan and time their charitable donations. Updates around who can claim deductions and how much can be deducted take effect in 2026. This makes 2025 a critical year for proactive planning.
Let’s break down what’s changing, who’s affected, and how to adapt your giving strategy.
What’s Changing
Starting January 1, 2026, OBBBA introduces several major updates that affect charitable tax planning.
Deduction Update for Non-Itemizers
Non-itemizers are now able to deduct up to $1,000 (single) or $2,000 (married filing jointly) in cash donations to qualifying charities.
New Limits for Itemizers
Introduction of annual floor—itemized charitable deductions must exceed 0.5% of adjusted gross income (AGI) to be claimed.
The 60% AGI limit on cash contributions becomes permanent.
Donors who itemize may lose some or all their deduction if they don’t cross the new minimum annual contribution percentage.
Limits on High-Income Taxpayers
For those in the top marginal federal bracket—the tax benefit of itemized deductions will be capped at 35% beginning in 2026.
Who’s Affected
Non-Itemizers (Standard Deduction Filers)
Low- and middle-income taxpayers who didn’t previously benefit from charitable deductions now have the ability to claim a modest charitable deduction for the first time starting in 2026.
Itemizers
Taxpayers whose deductions exceed the standard deduction.
Smaller or moderate donors may no longer qualify for a full itemized deduction without careful planning around the new floor.
High-Income Earners
Those in the highest federal tax bracket are the most impacted group due to the new 35% cap on the tax benefit of itemized charitable deductions.
How to Adapt Your Giving Strategy
Give before 2026 to avoid the new AGI floor, the new deduction cap, and reduced savings on large contributions.
Contribute to a Donor-Advised Fund (DAF) in 2025 to capture stronger deduction rules, then distribute donations to charities in future years.
Leverage Qualified Charitable Distributions (QCDs) by donating directly from your IRA to exclude the gift from taxable income, avoid AGI-based limits and satisfy the minimum distributions. This works regardless of whether or not deductions are itemized and avoids all new deduction limits. Available only for those age 70 ½ and older.
Bunch Your Charitable Gifts if your annual giving is modest by combining a few years of donations into one tax year. This helps taxpayers that are not in the highest bracket to hit the floor with their contributions.
Keep Detailed Records of all cash and non-cash contributions to qualify for deductions.
How We Can Assist You
The upcoming changes make tax strategy and informed planning more important than ever. Before making large charitable gifts or mapping out a long-term giving plan, reach out to Griffin & Furman, LLC.
Our team can help you analyze your individual tax situation, navigate the new OBBBA rules, and create a charitable giving strategy that maximizes your impact and your tax benefits.
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