Wealth Insights

2026 charitable deduction rules: What changed and who benefits

How the new rules may affect charitable giving strategies.

Summary

Under the new rules, single filers may deduct up to $1,000 per year while married couples filing jointly may deduct up to $2,000 per year. While non itemizers may have gained a new benefit, taxpayers who itemize deductions are now subject to a deduction limitation of 0.5% of AGI floor.

Nonprofit organizations may see more direct cash gifts under the $1,000 or $2,000 thresholds from everyday donors. High-income donors may shift to more strategic and potentially less frequent gifts throughout the year.

Earlier this year, federal tax law introduced some of the most significant changes to charitable deductions in nearly a decade. As of January 1, 2026, the law altered who receives tax benefits for giving and how much those benefits are worth. Millions of taxpayers will see charitable donations become deductible for the first time in years. However, higher income donors now face new limits, reducing the value of itemized deductions. These changes stem from the One Big Beautiful Bill Act (OBBBA) enacted in mid-2025.

Here is a look at some of the changes, who benefits, and what donors may want to consider.

2026 charitable donation: New deductions for non-itemizers

The most notable change could benefit an estimated 144 million taxpayers in 2027, according to Empower. And that is the creation of an above the line charitable deduction for taxpayers who claim the standard deduction. For the first time since the temporary COVID era relief provisions expired, non itemizers may once again receive a tax benefit for charitable giving.

Under the new rules, non-itemizing single filers may deduct up to $1,000 per year while their married counterparts filing jointly may deduct up to $2,000 per year.

This deduction directly reduces adjusted gross income (AGI). The catch? The deduction is limited to cash contributions made to qualified 501(c)(3) public charities as defined by the IRS. Donations to donor advised funds (DAFs), private foundations, supporting organizations, and non cash/in-kind gifts are excluded.

2026 charitable donations: Changes to itemized charitable deductions

While non itemizers may have gained a new benefit, taxpayers who itemize deductions may now face a different hurdle. As a result of the new tax rules, itemized charitable deductions are now subject to 0.5% of AGI floor. This means that only the portion of total charitable contributions exceeding half of one percent of AGI is deductible.

As noted in an article from KMP CPAs and Advisors, this rule generally applies to all itemizers, regardless of income level, and is calculated prior to applying other charitable contribution limits. As a result, smaller recurring gifts may no longer produce any tax benefit for higher income itemizers.

2026 charitable donations: High-income earners

Taxpayers in the highest federal income tax bracket now face a separate limitation on the value of itemized deductions in addition to the AGI floor. Under the new rules, any tax savings generated by itemized deductions, including charitable gifts, are now capped at 35%. The impact is worth noting as high earning donors (those in the top marginal tax bracket) still receive a tax benefit for charitable gifts. However, the after tax cost of giving is higher than under previous rules. When combined with the 0.5% AGI floor, these changes may reduce marginal tax incentives for large donors who itemize.

2026 charitable donations: What stays the same?

Despite the changes stemming from the OBBBA, several charitable tax rules remain intact in 2026. For starters, the 60% of AGI limit for cash contributions to public charities still applies. Additionally, donations of long term appreciated securities remain deductible at fair market value, subject to existing AGI limits.

Donors will find that Qualified Charitable Distributions (QCDs) from IRAs remain unchanged and are not subject to the 0.5% floor. It is important to note that for many retirees and high income households, QCDs remain a highly tax efficient charitable tool.

2026 charitable donations: Broader implications

The charitable giving incentive structure may shift away from itemized deductions and toward broader participation as a result of these changes. Smaller donors may now receive a modest tax benefit, while larger donors may need to rethink timing, structure, or strategy to maintain tax efficiency.

As for the impact on nonprofit organizations, they may begin to see more direct cash gifts under the $1,000 or $2,000 thresholds from everyday donors. Additionally, there may be a shift to more strategic though possibly less frequent gifts from high earning givers.

Three things to do:

1. Learn more about additional tax changes for 2026.
2. Review our comprehensive tax checklist to ensure your financial plan and tax plan account for the recent changes.
3. Individuals and nonprofit organizations can connect with Regions Philanthropic Solutions for more information on giving strategies and vehicles.